Mortgage approvals fall in April

CEO of Octane Capital, Jonathan Samuels, commented:

“The month on month reduction in mortgage approvals seen in April was always likely to materialise given the Bank of England’s decision to increase interest rates just one month prior.

What we’re now seeing is a knee-jerk reaction by buyers when facing these higher borrowing costs take shape as a reduction in mortgage market activity.

The good news is that this is likely to be a temporary reduction as they go back to the drawing board to ascertain just how much they can afford to borrow before returning to the fold.

However, we’ve already seen the base rate rise again in May, with a further hike expected this month, so we can expect monthly mortgage approval trends to remain erratic, at best, for the foreseeable future.”

Managing Director of Sirius Property Finance, Nicholas Christofi, commented:

“Current mortgage market activity levels remain some way off the pandemic pace seen in recent years, with total approvals in April down 26% annually.

However, while a marginal monthly reduction reflects the uncertainty of the current landscape, almost 49,000 mortgages were approved in April which is by far the second highest level seen so far this year.”

Founder and CEO of easyMoney, Jason Ferrando, commented:

“We’ve seen strong signs that the spring surge in market activity is well and truly underway, with mortgage approvals climbing quite considerably since the start of the year.

This remains the case despite a slight monthly reduction and with the exception of last month, April’s total is the strongest performance seen in the last six months.

Of course, the threat of yet another interest rate hike this month could prove problematic, with the ever escalating cost of borrowing already proving a sizeable hurdle and one that is causing buyers to tread more tentatively.”