Net borrowing of mortgage debt by individuals across the UK fell from £2.2bn in April to £1.2bn in May, new figures published by the Bank of England (BoE) have revealed.

The Bank’s latest data also showed that net mortgage approvals for house purchases, totalled 60,000 in May, a slight fall from 60,800 in April.

Approvals for remortgaging, which only capture remortgaging with a different lender, also registered a slight fall, from 29,900 to 29,600.

Gross lending rose for the fourth consecutive month to £22.2bn in May, up from £21.1bn in April, while gross repayments saw an increase of £1.2 billion over the same period to £20.5bn.

Mortgage expert at Quilter, Karen Noye, said that the latest BoE data “points to a housing market in paralysis”.

“Net mortgage approvals for house purchases, which signal future borrowing trends, dropped to 60,000 in May from 60,800 in April,” Noye said.

“This decline indicates a growing hesitancy among buyers to commit to new property purchases, which given the economic environment is understandable, but also suggests a cautious outlook may have intensified as the electorate braces for the upcoming election amidst talk of policy changes.

“There is also an increasing trend of homeowners choosing to stick with their current lender when their mortgage deal ends, rather than remortgaging to a new one. Historically, many of these customers would switch to a different lender to secure the best rates.

“However, with average mortgage rates so much higher than what they were used to many are opting to stay with their current lender through a product transfer to avoid the stringent affordability checks and potential higher costs associated with switching lenders.”

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