UK mortgage approvals rise in June while interest rates ease

UK mortgage activity picked up in June, with net borrowing and approvals both rising, while remortgaging activity hit its highest level since October 2022, data from the Bank of England showed Tuesday.

Net mortgage borrowing by individuals rose to £5.3 billion in June, up from £2.2 billion in May. Gross lending reached £23.9 billion, while gross repayments climbed to £18.8 billion.

Mortgage approvals for house purchases, which serve as an indicator of future borrowing, increased slightly to 64,200 in June from 63,300 the month prior. Approvals for remortgaging also rose, up to 41,800, the highest level in nearly two years.

The average interest rate on newly drawn mortgages fell for a fourth consecutive month, easing to 4.34% in June from 4.47% in May. The effective rate on the outstanding stock of mortgages edged up to 3.88% from 3.87%.

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