Mortgage approvals fall to lowest since end-2023
Mortgage approvals for house purchases declined in August, hitting a level not seen since the end of 2023. Remortgage approvals also slipped. The changes come as borrowing costs remain high, reflecting higher interest rates and living expenses. The data are from the Bank of England’s latest Money and Credit release and are watched as an indicator of future housing market activity.
What changed last month
August saw 54,900 mortgages approved for house purchases, down from 55,900 in July. Remortgaging approvals fell to 34,000 from 34,600 the previous month. The effective interest rate on newly drawn mortgages rose to 4.6% in August from 4.45% in July, indicating higher costs for new loans.
Key figures and meaning
Overall mortgage approvals are a forward-looking indicator of borrowing demand. The August totals are the lowest since December 2023 and sit below the six-month average of about 60,100. The rise in the actual borrowing rate is a sign that lenders are pricing in higher costs, which can dampen buyers’ plans.
Who is affected
Potential home buyers may face increased difficulty securing loans, especially people with thinner credit profiles or smaller deposits. Existing homeowners with variable-rate deals could feel pressure if refinancing options become more expensive. Mortgage market slowdowns can indirectly affect house prices and housing market confidence, though this article does not speculate on price movements.
Practical next steps for readers
If you’re considering buying a home or remortgaging, you may want to review current rates from multiple lenders, examine loan costs over the full term, and consider how higher rates could affect repayments. Keep an eye on upcoming Bank of England data releases for further trends in borrowing and housing demand.
Limits and questions
The figures reflect a monthly snapshot and come from the Bank of England’s Money and Credit data. They do not, by themselves, predict house prices or individual affordability. Readers should consider this as one piece of the broader housing market picture and consult multiple sources for a full view.
Which sources did Setup in Bahrain review?
Setup in Bahrain reviewed the following source material before preparing this explanatory article.
The links remain visible so readers can inspect the evidence, compare dates and context, and confirm current requirements with the relevant authority.
- nation.cymru — evidence source reviewed for this article.
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