Net mortgage borrowing dropped from £8bn in May to £5.3bn in June, reports the Bank of England (BoE).

The bank points out that despite this monthly drop, June’s figure is still above the 12-month pre-pandemic average (up to February 2020), which stands at £4.3bn.

Meanwhile, approvals for house purchases fell from 65,700 to 63,700 – and from a value of £16bn to £15.6bn, while approvals for remortgages decreased from 47,200 to 44,000.

Here, the value fell from £10.1bn to £9.5bn.

Both of these classes of approvals were below the 12-month pre-pandemic average of 66,700 and 49,500, respectively, the BoE adds.

Gatehouse Bank chief commercial officer Paul Stockwell says: “With the cost of living rising, record inflation and several months of consecutive interest rate hikes, it’s not surprising that the demand for mortgages has dipped.

“We are just concluding what is traditionally the busiest period for property purchases each year, and as mortgage market professionals and their clients go on holiday over the summer months, we would expect a slowdown in activity.

“It is also important to remember that year-on-year numbers are being compared to a period characterised by the stamp duty holiday, and appetite for purchase will naturally have seen a decline since this ended in June 2021.”