Mortgage approvals dip for second month

The number of mortgage approvals for house purchase fell for the second consecutive month during May, Bank of England data shows.

Banks approved 59,991 mortgages for house purchase in May, down from 60,821.

But the figure was up 19.2% annually.

It reflects a period of high mortgage rates for much of the first half of the year, which may have deterred buyers.

Tom Bill, head of UK residential research at Knight Frank, said: “Mortgage rates drifted higher over the first six months of the year as stubborn services inflation meant the prospect of the first rate cut since March 2020 has become more remote. 

“Together with uncertainty surrounding the General Election, that has kept a lid on the seasonal rise in trading activity this spring. We expect transaction volumes to rise in the second half of this year as a rate cut becomes imminent and more political stability returns to Westminster.”

Nathan Emerson, chief executive of Propertymark, added: “Although we have seen a real uplift across the sector since the start of the year, recovery can come with ups and downs along the way.

“With the General Election now only days away, we are keen to see more detailed plans and timeframes from any incoming government regarding support for buyers across the coming weeks. Propertymark also remains hopeful once conditions are right, we will witness a reduction in the base rate too.”