Key facts
- Mortgage approvals increased by 3% in June.
- A total of 58,200 mortgages were approved in June.
- Net mortgage borrowing rose to £7.7 billion in June.
- Experts warn of potential interest rate hikes.
- Rising energy prices are cited as a reason for potential rate hikes.
- Rate hike fears could retract recent mortgage approval gains.
- Housing affordability is expected to remain under pressure.
In June, mortgage approvals experienced a slight increase of 3%, totaling 58,200 approved mortgages. Concurrently, net mortgage borrowing rose to £7.7 billion. This data comes from the Bank of England. Despite these positive indicators for the housing market, a significant concern looms regarding potential interest rate hikes. Experts suggest that surges in energy prices could trigger further increases in interest rates. Such a development would likely counteract the recent gains in mortgage approvals and borrowing. The primary worry is that sustained or increased interest rates will keep housing affordability under pressure. This could potentially retract the recent gains observed in the market and hinder further recovery for prospective buyers who are already navigating a challenging financial landscape.