The latest data from the Bank of England figures show that mortgage approvals on house purchases for June sat at 64,167 up (+1.4%) from 63,288 in May. 

This signals two consecutive months of growth.

Approvals are also up (+5.6%) when compared to the 60,761 seen in June 2024.

The Bank says this growth is positive, and there is optimism for further growth in the coming months, especially if bank rate cuts materialise and lenders continue to lower their mortgage rates.

Sarah Coles, head of personal finance at Hargreaves Lansdown, comments: “The mortgage market is staging a small recovery, with approvals for purchases rising for the second consecutive month after falling for four. It’s a slow climb, but the direction of travel is important, and demonstrates that the end of the stamp duty holiday hasn’t brought the market to a dead end.

“In context, none of these moves are earth shattering. Approvals for purchases came in at 64,200. Last year, approvals averaged 62,700 a month. So far this year, they are averaging 64,400. The year before the pandemic, the 12-month average was 66,700. It means this is a relatively steady set of figures.

“As a result, late summer and early autumn won’t shoot the lights out. We should see reasonably solid demand after RICS reported a slight pick up in buyers, sellers and sales in June. Property prices, however, remain relatively flat, and aren’t set to ramp up significantly in the immediate future.”

John Phillips, chief executive of Just Mortgages and Spicerhaart, says: “It’s positive to see another monthly increase in mortgage approvals, even if it’s only marginal. While the summer period may slow things slightly, it’s encouraging to see some momentum building in the mortgage market, with prospective buyers and movers buoyed by ever-growing innovation among lenders and an increasing spotlight on improving affordability and access to new mortgages. Although the jury may still be out on its decision, all eyes will be on the MPC meeting next month and whether we see another cut to the base rate.”

Lucian Cook, head of residential research at Savills, states: “The steady rise in mortgage approvals is encouraging, but despite some easing in how lenders apply affordability tests, approvals remain slightly below levels typically seen in a normal market. That reflects the relative caution among prospective home movers in what remains a price sensitive market, particularly in the south of England.

“Changes in the way mortgage regulations are being applied have the capacity to free up more mortgage lending among bother first time buyers and home movers, especially as we see further interest rate cuts. We anticipate that mortgaged buyer demand will pick up gradually heading into early autumn. However, for momentum to truly build, households must feel more confident not only in their personal finances but also in the broader economic environment.”

And Alice Haine, personal finance analyst at BestInvest by Evelyn Partners, adds: “It appears slower house price growth in June, as the stamp duty changes, geopolitical uncertainty and a lacklustre economic outlook fed through to the market, failed to deter committed buyers from taking action and plunging into the market. Any buyers purchasing a property since April 1 are subject to the previous, lower stamp duty thresholds, so while some may be reevaluating their affordability position, others are pushing ahead with purchases.  

“Despite inflationary pressures forcing consumers to grapple with higher household, energy and food bills once again, affordability is improving for buyers. This was evident in the effective rate on newly drawn mortgages, which eased to 4.34% in June compared to 4.47% in May.  

“With geopolitical concerns easing since June, mortgage activity is expected to pick up further in the months ahead, particularly if the anticipated base rate cut in August materialises and house prices weaken. Weak economic growth, rising unemployment and cooling pay growth may be enough to prompt the Bank of England’s rate-setting committee to push ahead with the fifth reduction since August last year.”