UK mortgage approvals fall to two-and-a-half-year low in May
6 reported
According to a single-source report from The Guardian, UK mortgage approvals fell to their lowest level in two and a half years in May, as rising borrowing costs dampened demand for home purchases. The Bank of England reported that lenders approved 56,205 mortgages in May, down from 66,034 in April and below the six-month average of 63,300. This is the lowest monthly total since December 2023. Approvals for remortgaging also declined, dropping to 33,300 in May from 51,200 in April. The report attributes the rise in mortgage costs to the start of the Iran war, which pushed up oil prices and bond yields as investors anticipated higher inflation. Simon Gammon of Knight Frank Finance stated that leading fixed mortgage rates were just above 4.5% in May, up from around 3.5% before the Middle East conflict began. Net borrowing of mortgage debt by individuals fell to £2.9bn in May, down from £4.4bn in April, the lowest since April 2025.
What’s reported
UK mortgage approvals in May were 56,205, down from 66,034 in April and below the six-month average of 63,300.
This is the lowest monthly total since December 2023.
Remortgaging approvals fell to 33,300 in May from 51,200 in April.
Net borrowing of mortgage debt dropped to £2.9bn in May from £4.4bn in April, the lowest since April 2025.
Leading fixed mortgage rates were just above 4.5% in May, up from around 3.5% before the Middle East conflict began.
The report states that the rise in mortgage costs followed the start of the Iran war, which pushed up oil prices and bond yields.
Key figures
Simon Gammon, managing partner at Knight Frank Finance
Damien Burke, head of regulatory practice at Broadstone
Sources: The Guardian
