UK Mortgage approvals on the rise. In the unfolding narrative of the UK’s property market, March 2024 has marked yet another month of ascending mortgage approvals, with the Bank of England’s latest Money and Credit figures spotlighting a slight increase to 61,300 from February’s 60,500. This uptick in March represents the sixth consecutive month of growth in mortgage approvals for house purchases, pointing to a potentially revitalising housing market, which last saw similar levels in September 2022. Its a major plus for the housing market and estate agents but there are still other challenges affecting the overall housing and property industry.

A Dual-Faceted Scenario – UK Mortgage Approvals on the Rise 

Despite the overall growth in house purchase approvals, the situation for remortgaging tells a different story. The figures for net remortgaging approvals have seen a decline, dropping to 34,200 in March from February’s 37,700, indicating a less favourable condition in this segment of the market.

Rachel Springall, Finance Expert at, reflects on the recent trends, noting the impact of early 2024’s dip in fixed-rate mortgage pricing, which helped bolster borrower enthusiasm. “The volume of mortgage approvals is at its highest level since the mini-Budget, underscoring the significant influence of mortgage pricing on borrower sentiment,” Springall elaborates.

Rising Rates and Affordability Concerns

However, this optimistic pulse within the mortgage approval statistics is tempered by broader economic pressures. Recent weeks have witnessed a slew of major lenders hiking their rates, contributing to a growing unease about affordability among both prospective and current homeowners.

Springall warns of the potential ongoing volatility, “Since these figures were captured, mortgage rates have been creeping up, and the uncertainty surrounding future interest rate expectations will likely prompt lenders to revisit their pricing strategies frequently.”

As of the 1st of May, the average rates for two-year and five-year fixed mortgages stand at 5.91% and 5.48%, respectively. These figures have climbed from 5.80% and 5.39% at the beginning of April, presenting a stark contrast to the lower rates enjoyed over two years ago.

The Impact on Homeowners and First-Time Buyers

For homeowners nearing the end of their fixed-rate deals, the prospect of increased monthly payments is imminent, further strained by the broader rising costs affecting various aspects of living.

The current market conditions are proving particularly daunting for first-time buyers, with Paul Broadhead, Head of Mortgage and Housing Policy at the Building Societies Association, commenting on the unprecedented expense of entering the property market. “Becoming a first-time buyer is possibly the most expensive it has been in at least the last 70 years,” he states.

A recent BSA report highlights the reliance of first-time buyers on family support for deposits and the necessity of dual above-average incomes to secure a property. This report underscores the challenges of affording a home in today’s market, exacerbated by a chronic shortage of affordable housing.

Advice for Prospective Homeowners

Springall offers practical advice for those navigating these turbulent waters. “Aspiring property owners must be aware that affordable housing is in short supply, necessitating significant market changes. Potential buyers might find themselves waiting longer if they can’t amass a sufficiently large deposit.”

She suggests a prudent approach to managing finances, advocating for the reduction of non-essential expenses and a vigilant attitude towards any potential increases in utility bills or commuting costs.

Looking Ahead

As the UK housing market continues to evolve amid fluctuating mortgage rates and economic pressures, the journey for homebuyers remains fraught with challenges. The key to navigating this landscape lies in timely consultation with financial advisors and careful financial planning, ensuring that those on the path to homeownership can make informed decisions in a complex market.