Data released by the Bank of England shows that mortgage approvals for house purchases increased by 2,4000 to 63,000 in May – the first increase since December 2024. Re-mortgage approvals also increased, up by 6,200 to 41,500.
Property industry experts reacted positively to the indicator of future demand – however some commentators from the finance sector remain cautious.
Richard Donnell, executive director at Zoopla, commented:
“Mortgage approvals have increased for the first time in five months as increased sales agreed has boosted the demand for mortgages from home buyers. More homes for sale mean more buyers and sales. We expect demand for mortgages to continue to increase as more sales are agreed. The market remains on track for 5 per cent more sales in 2025 with price inflation steady at 2 per cent.”
Propertymark CEO Nathan Emerson also welcomed the news, saying:
“It is incredibly positive news to see an increased number of mortgage applications approved. It is one of the loudest signals of them all regarding consumer affordability, and it is also a massive vote of confidence from lenders in the longer-term prospects of the economy too.
“As we head into the summer months, we have witnessed on average the number of viewings per property available see an uplift of around 30 per cent compared to the month previous.”
John Phillips, CEO of broker Just Mortgages and estate agent group Spicerhaart, said the figures reflect feedback from branches and brokers. He added:
“The housing market continues to show real resilience – even in the face of stubborn inflation and some painful changes that came with the new tax year. This has been helped by continued innovation from lenders and real proactive support from advisers.
“Just as encouraging is a drop in net borrowing of consumer credit, which shows there is less reliance on the likes of credit cards and that hopefully the heavy financial burden felt by many households is slowly starting to ease. This all helps towards affordability and accessibility as many individuals look to turn appetite into ability with the help of their local adviser.”
Sarah Coles, head of personal finance at Hargreaves Lansdown, said the direction of growth is encouraging, but suggested ‘we shouldn’t get ahead of ourselves’. She added:
“It’s likely to mean the summer remains relatively sluggish for purchases, and given that more properties are up for sale, it’s worth keeping an eye on what this does to prices.”
Welcoming the news, Anthony Codling, managing directory of equity research at RBC Capital Markets, said the government must now grasp the opportunity to help people onto the property ladder.
“This is good news for the housing market and gives us confidence that the reduction in housing market activity following the end of the stamp duty holiday was a blip not a trend. Housing market activity is broadly in line with the five-year average, comforting news for homebuyers and sellers.
“However, the Government will need to see a more active housing market if it is to get close to its five-year target of 1.5 million new homes. The question now is ‘when’, not ‘if’ we will see the Government stimulating housing demand and helping first time buyers on to the housing ladder.”
