The number of mortgage approvals dropped as the UK passed the March 29 Brexit deadline but is now set to increase.

The latest Bank of England Credit Conditions Survey revealed that the number of mortgage approvals decreased in the three months to the end of May, but showed that lenders are anticipating an increase in the run-up to the end of August.

Lenders also reported that demand for mortgages had increased in the second quarter aside from remortgage business.

Looking ahead, lenders are predicting increases in demand for all types of mortgages until the end of August.

Commenting on the figures, Andrew Montlake, managing director of mortgage broker Coreco, said: “Passing the March 29 Brexit deadline was a symbolic moment for the UK property market.

“Sentiment among prospective buyers shifted very quickly from apprehension to a more positive mindset.

“The sharp strengthening in demand for house purchases during the second quarter reflects this shift in sentiment, and the broader Brexit pragmatism that took root.

“Looking forward, lenders are clearly more optimistic than some about the trajectory of demand in the third quarter.

“If demand for house purchases remains unchanged given the potentially turbulent months ahead, then that will be a considerable achievement.

“We are at a pivotal point in the Brexit endgame and a no-deal Brexit is now looking far more likely.

“As we enter uncharted waters, the impact of a no-deal Brexit on demand for property is anyone’s guess.”