UK Mortgage Approvals Hit Three-Month High in April

The Bank of England released data on Tuesday showing mortgage approvals for house purchases rose to 65,945 in April from 63,979 in March. The figure was the highest monthly total in three months. Mortgage approvals are viewed as a leading indicator of housing market activity because they reflect lending decisions made before property purchases complete.

The central bank also reported net unsecured lending to households of £1.859 billion in April, slightly below March’s £1.904 billion but above economists’ expectations of about £1.7 billion. Unsecured lending covers personal loans, overdrafts and credit-card borrowing.

More recent housing-market measures indicated weaker conditions. Nationwide reported average UK house prices fell 0.6% in May from April, the first monthly decline since December. Nationwide’s seasonally adjusted house price index fell to 551.0 in May from 554.3 in April, while the non-seasonally adjusted average price slipped to £278,024 from £278,880.

Nationwide reported annual house price growth slowed to 1.7% in May from 3.0% in April.

The Royal Institution of Chartered Surveyors recorded declines in both house prices and buyer demand during April.

Lenders have reported rising mortgage rates since the start of the conflict in Iran in late February, and some lenders reported softer market conditions.