The Bank of England’s Money and Credit Report for September showed an increase of net borrowing of mortgage debt by individuals of £1.2 billion, to £5.5 – the highest since March 2025.
The annual growth rate for net mortgage lending increased to 3.2%, from 3.0% in August, the highest since January 2023 (3.4%). Net mortgage approvals for house purchase, indicative of future borrowing, increased by 1,000, to 65,900. Approvals for remortgaging (limited to remortgaging with a different lender) fell by 600, to 37,200.
Commentary
Richard Donnell, executive director, Zoopla:
“Demand for mortgages to buy homes continues to increase but at a slowing rate as the rolling total over the last 12 months starts to level off as housing transactions reach close to their 10 year average of 1.2m. While budget speculation has hit demand and sales for homes over £500,000, the rest of the market is less affected which explains the continued demand for mortgages.”
Nathan Emerson, CEO, Propertymark:
“An uplift in the number of mortgage approvals is encouraging to witness. Many cogs need to turn harmoniously together when it comes to consumer confidence and affordability, and despite challenges within the wider economy, it is positive to see people being able to take their next step onto the housing ladder with greater ease.
“There are still concerns which need to be acknowledged, however, such as inflation sitting close to double what the Bank of England have targeted and the influence this can have regarding base rate decisions. Despite this, we remain in a much stronger position than we started the year at, when the base rate stood much higher at 4.75%.”
Joe Pepper, UK CEO, PEXA:
“Sticky inflation and interest rates remaining has created a little bit of apathy in the market – people are no longer waiting for a better rate environment to buy or remortgage because they aren’t necessarily expecting this to happen any time soon. Empowering more individuals to confidently mortgage and remortgage. We are also starting to see the positive impact of affordability measures introduced earlier this year and it is positive to see the market start moving in the right direction.
“However, as mortgage approvals increase, bottlenecks form across the market because the technology that sits behind the transaction process simply isn’t up to the job. Conveyancers, who are already under significant strain, will be pushed to their limits because they don’t have the right tools and technology in place to help them deal with demand. We need far greater attention placed on reforming the back-end infrastructure that supports the process to overcome this, delivering a more certain, secure and streamlined process. Addressing this could not be more urgent if we are going to maintain growth and reap the benefits.”
Mark Tosetti, CEO of CAL (part of Movera):
“An uptick in net borrowing and slight increase in net mortgage approvals indicates that there is still strong demand in the market and that we have emerged, tentatively from a slow summer. But the looming autumn budget is clearly continuing to put a damper on consumer confidence, with the latest data from Zoopla – released earlier this week – suggesting buyer demand is down 8% compared with last year and sales agreed have fallen by 3%.”
“However, as inflation fell short of the Bank of England’s 4% forecast this month, the MPC’s base rate decision next week could provide a lifeline for the sector and generate some more attractive interest rates from lenders.”
Colby Short, co-founder and CEO, GetAgent:
“The latest figures show that mortgage approvals have bounced back following last month’s dip, providing yet more evidence that the market remains on a stable and upward trajectory. Buyer intent hasn’t faltered and we’re now seeing that intent convert into completions, with agents reporting strong sales activity across much of the country despite the wider economic noise.
“It’s only natural that fiscal events such as the upcoming autumn budget may create brief pauses in activity, but the long-term picture remains overwhelmingly positive. Approval volumes have held firm throughout 2025 and we’re on course for what’s shaping up to be an extremely healthy year for both approvals and transactions alike.”
Simon Webb, managing director of capital markets and finance at LiveMore:
“Buyer interest remains robust as we emerge from the summer slump, but clearly there is ongoing pent-up demand. What the market needs most is a period of stability in monetary policy so the MPC’s decision next week and the outcome of the Autumn Budget will be key.
“For later life lending, the opportunity is clear. Borrowers aged 50 to 90+ still face limited awareness of their options, but demand is there.”
John Phillips, CEO of Just Mortgages and Spicerhaart:
“While there has been plenty of talk of a holding pattern pre-Budget, today’s figures show that this isn’t the case for all borrowers. An increase in approvals in September demonstrates the appetite and demand that still exists in the market – whether that’s those pushing ahead with plans, or perhaps more likely, those that need to move rather than necessarily wanting to right now. Either way, the figures reflect what we are seeing across our estate agency branches and our brokerage with relatively robust figures for new buyer registrations, valuation requests and mortgage appointments.”
Anthony Codling, managing director equity research, RBC Capital Markets:
“In an increasingly uncertain market this stability will be welcomed, but is supporting nowhere near the level of housing market activity required to underpin the building of 1.5 million homes. This data confirms what we have seen elsewhere that the autumn selling season is not showing its face in 2025. Homebuyers appear to be sitting on the fence until seeing what the budget brings, and this will delay housebuilders ability to build up their orderbooks for 2026, therefore volume estimates may need to be reduced and we run the risk of building fewer rather than more homes in the coming year.”
Richard Merrett, managing director, Alexander Hall:
“A renewed strengthening in mortgage approvals reinforces the positive market sentiment and consistency that we’ve seen across the mortgage sector throughout 2025. Despite broader economic uncertainty, borrowers continue to show confidence, supported by more accessible mortgage products and steady lender appetite.
“There is, of course, a chance that we could see mortgage market activity reduce in the short term as the autumn budget approaches, with some homebuyers taking a brief pause to see what the government has up its sleeve. However, any hesitation will be temporary and, with inflation now holding steady at 3.8% for the third month running, there’s growing optimism that a base rate cut could still arrive before Christmas. If so, it would help fuel renewed momentum and set the stage for a strong start to 2026.”
Jonathan Samuels, CEO of Octane Capital:
“A return to positive growth in September, following the summer lull seen in August, provides further reassurance that confidence remains embedded within the mortgage market. Buyer demand has been remarkably consistent throughout the year, and the stability we’re seeing in approval volumes reflects that strength.
“Of course, major fiscal events such as the upcoming Autumn Budget can bring a degree of hesitation among homebuyers, but this is typically short-lived. The longer-term picture remains one of resilience, and the steady pattern of approvals seen throughout 2025 highlights a market that is balanced, confident, and quietly strengthening.”
See the full report: https://www.bankofengland.co.uk/statistics/money-and-credit/2025/september-2025
