Mortgage approvals slipped in May, although gross lending lifted for the fourth month in a row, Bank of England data shows.  

Net mortgage approvals for house purchases fell 1.3% in May to 60,000 from the previous month. Remortgages also edged 1% lower to 29,600 over the same period.  

However, gross mortgage lending in May rose for the fourth consecutive month to £22.2bn, up from £21.1bn in April.   

Gross repayments saw an increase of £1.2bn over the same period to £20.5bn, according to the central bank’s latest Money and Credit Report.  

But net borrowing of mortgage debt by individuals fell from £2.2bn in April to £1.2bn in May.   

The annual growth rate for net mortgage lending rose to 0.3% in May, after a rise to 0.2% in April — the first rise in the growth rate since October 2022.  

SPF Private Clients chief executive Mark Harris says: “Mortgage approvals for new purchases dipped slightly on the previous month, perhaps reflecting stubbornly high mortgage rates, which may have raised borrower concerns with regards to affordability and confidence.   

“Remortgaging numbers decreased again as borrowers chose to stick with their existing lender and do a product transfer rather than go through the additional hassle of refinancing to another lender.   

“With inflation hitting its 2% target, an interest rate cut is increasingly likely, which will boost the market and give lenders more confidence to price their mortgage rates lower.”  

Propertymark chief executive Nathan Emerson adds: “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.”  

Octane Capital chief executive Jonathan Samuels points out: “Mortgage approval levels may have fallen marginally over the last two months, however, they remain considerably higher than we’ve seen for quite some time, which demonstrates that the sector is continuing to benefit from a far greater degree of stability since the base rate has been held.  

“There is no doubt a ‘wait and see’ element at play here as well, with a segment of buyers putting their plans to purchase on temporary hold ahead of the election.   

“So, while mortgage approval levels have remained consistent of late, we expect to see further growth in these numbers as the year progresses.”  

But But Broadstone director, risk, Tom Cuppello says: “The housing market remains precarious albeit beginning to show green shoots of growth and stability.   

“Uncertainty over rate cuts lowering the cost of borrowing continues to keep a lid on mortgage borrowing however we could see a lot of bottled-up activity resume as and when the Bank of England begins to lower the base rate.”