Mortgage pressure hits buyers but approvals rise as mortgage approvals reached their highest level in 15 months during April, indicating that buyer demand remained resilient despite rising borrowing costs and continued economic uncertainty.

While approvals increased, net borrowing of mortgage debt – which reflects completed house purchases and typically lags approval data – fell from £6.8bn to £4.4bn, the lowest level recorded since October 2025. Meanwhile, the effective interest rate on newly drawn mortgages edged up to 4.08% from 4.03%, adding further pressure on affordability for homebuyers.

Latest Bank of England figures show lenders approved 65,945 mortgages during the month, up from 63,979 in March and the highest monthly total since January 2025. The figure was also well ahead of economists’ expectations of 62,000 approvals.

The data points to continued activity in the housing market even as rising energy prices and concerns over inflation, fuelled by the conflict between Iran and Israel and its impact on global markets, have dampened hopes of faster interest rate cuts.

Jason Tebb, president of OnTheMarket, said: “Approvals for house purchases – an indicator of future borrowing – rose again in April as buyers and sellers pressed ahead with their plans.
“Of course, these figures reflect decisions made in the earlier stages of the conflict in the Middle East when buyers may have been keen to take advantage of competitive mortgage rates they had managed to secure. It also demonstrates the ongoing resilience of the housing market and the recent holds in base rate from the Bank of England should further help reinforce this sense of stability.
“Our own property sentiment index suggests that buyers and sellers continue to adapt to market conditions. Even against a backdrop of ongoing political and economic turbulence, attitudes towards affordability, property values and moving home remain remarkably consistent.”

However, rising mortgage rates, falling house prices and weak buyer demand suggest the recovery may still face headwinds in the months ahead.

Analyst Anthony Codling, managing director at RBC Capital Markets, said: “UK mortgage approvals for house purchases climbed to 65,945 in April, up 3.1% from March and a robust 9.0% higher than April 2025. The print came in 7% above the five-year monthly average and 2% ahead of the ten-year run rate, marking the strongest year-on-year gain since last summer. April’s strength represents a welcome rebound after a soggy start to the year – January and February were both below 64,000, weighed down by geopolitical jitters and a wobble in consumer confidence.
“But before housebuilders pop the champagne cork, it’s worth noting that mortgage rates have climbed back to 5.68% for two-year fixes, house prices fell 0.6% in May for the first time in 2026, and estate agents report that new buyer inquiries remain weak. April delivered jam today; whether there’s more jam tomorrow is another question entirely.

Simon Gammon, managing partner, Knight Frank Finance, added: “Whether momentum slows meaningfully will depend on how long the conflict persists and whether domestic political developments place further upward pressure on borrowing costs. Lender margins remain extremely thin, leaving little room for manoeuvre should market volatility return or the conflict continue for longer than investors currently expect.”