The number of net mortgage approvals for house purchases increased significantly to 52,000 in March, up from 44,100 in February, new Bank of England (BoE) figures have indicated.

This latest figure still remains below the monthly average of 62,700 across 2022.

According to the Bank’s figures, approvals for remortgaging – which capture just remortgages with a different lender – also saw a rise from 28,200 in February to 32,200 in March.

Borrowing of mortgage debt by individuals in the UK fell further from a net flow of £700m in February to net zero in March. The BoE stated that this is the lowest level since July 2021, when the figure stood at a net repayment of £1.8bn.

Furthermore, if the period since the onset of the COVID pandemic was to be excluded, net borrowing of mortgage debt in March was at its lowest level since June 2011, when there was a £300m net repayment.

The BoE also reported that gross lending increased slightly from £20.4bn in February to £20.6bn in March, while gross repayments fell from £19.9bn to £19.3bn.

CEO at fintech broker Loan.co.uk, Paul McGerrigan, commented: “It is encouraging to see mortgage approvals for house purchases increase significantly this month, after net lending dropped dramatically in February.

“It doesn’t take an expert to realise that rapidly increasing interest rates are impacting the property market considerably, members of the BoE’s Monetary Policy Committee remain stuck between a rock and a hard place when they meet next week.

“It can take 18 months for monetary policy to work its way into the system to curtail inflation but can take only weeks to impact the property market. It feels like time for the MPC to hold rates and allow the borrowers, and the market, the chance to breathe and settle into a more normalised state.”

The BoE has also released figures for the consumer credit market, which showed that individuals borrowed an additional £1.6bn in consumer credit in March, on net. This compare to £1.5bn of borrowing in February.

According to the data, March borrowing was split between £700m of borrowing on credit cards, which was broadly unchanged from February, and £900m of borrowing through other forms of consumer credit, such as car dealership finance and personal loans.

The Bank also revealed that the annual growth rate for all consumer credit marked the sixth consecutive month of increase, from 7.7% in February to 7.9% in March, while he annual growth rate of credit card borrowing fell from 13.2% to 12.8%.

Head of personal finance at Hargreaves Lansdown, Sarah Coles, said: “We borrowed another £1.6 billion in consumer credit, and £0.9 billion of it was borrowing like car finance and personal loans. Some of this will be consolidation, but an awful lot of it will be people deciding that now is the time to take the plunge on a major expense.

“The question may now be whether people have jumped too soon. While we’re expecting inflation to fall over the coming months, there are no guarantees that it will do so quickly, and in many cases this won’t mean things getting cheaper: they’ll just get more expensive more slowly.

“If people are stretching their finances with a property purchase, a new car, or spending their savings on a holiday, there’s the risk they will come to regret it if the squeeze doesn’t ease as fast as they expected.”

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