The total figure for net borrowing of mortgage debt by individuals across the UK saw a rise to to £7.4bn in May, according to the Bank of England (BoE).

This was up from the £4.2bn reported by the BoE for April and now sits above the 12-month pre-pandemic average up to February 2020 of £4.3bn.

Gross lending increased to £28.4bn in May, up from £26.7bn in April, while gross repayments also climbed slightly to £21.8bn in May from £21.6bn in April.

Approvals for house purchases, which the BoE uses as an indicator of future borrowing, also climbed marginally to 66,200 in May, up from 66,100 in April. This figure was slightly below the 12-month pre-pandemic average up to February 2020 of 66,700.

The BoE also revealed that approvals for remortgaging – which only capture remortgaging with a different lender – remained unchanged at 78,800 in May. This remained below the 12-month pre-pandemic average up to February 2020 of 49,500.

Commenting on the Bank’s latest figures, TMA Club development director, Lisa Martin, said: “Today’s figures reflect a resilient mortgage market. Recent interest rate hikes and the cost-of-living crisis are likely to be influencing a more cautious approach by lenders, but approvals for house purchases rose slightly to 66,200 in May, from 66,100 in April.

“Conversely, with the recent spike in mortgage maturities and, again, rising rates, it’s no surprise to see remortgage approvals rise to 78,800, from 47,800 in April. 
 
“As prices are likely to continue to rise throughout the year, customers will be looking to brokers to act swiftly to secure the best deals and lock into fixed rates before mortgages are replaced or pulled from the market.”

Just Mortgages national operations director, John Phillips, added: “Doom merchants who predicted the housing market would fall off a cliff when the pandemic hit were badly wrong. Levels of borrowing and house buying have defied expectations and are now higher than pre-pandemic, although it must raise the question just how much longer can these increases continue.

“We may well see a tail off in house purchases as the cost of living continues to rise, but instead it will drive remortgages as people look to lock into longer term fixed rates to protect them from interest rates that look set to increase several more times yet.”

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