Net mortgage approvals for home purchases came in at 61,100 in April, edging 0.3% lower compared to the previous month, Bank of England data shows.
Remortgaging net approvals fell 10.7% to 29,900 over the same period, according to the central bank.
However, mortgage borrowing jumped to £2.4bn of mortgage debt in April, compared to £500m in March. Home loan approvals are an indication of future lending.
This was the fourth month in a row provisional seasonally adjusted home sales were higher.
Shawbrook managing director of real estate Emma Cox says: “A slight dip in mortgage approvals reflects the hesitancy creeping back into the market.
“Following the announcement of a July general election and uncertainty surrounding rate cuts, we are still seeing signs of volatility, and until there is more certainty and a clearer downward trend in inflation, lenders may adjust their rates accordingly.
“This means that those looking to secure new deals could face higher rates in the short term.”
SPF Private Clients chief executive Mark Harris adds: “Mortgage approvals for new purchases were fairly consistent with the previous month, perhaps reflecting mortgage rates edging upwards, which may have raised borrower concerns with regards to affordability and confidence.
“Remortgaging numbers decreased again, perhaps as borrowers chose to stick with their existing lender and do a product transfer rather than go through the additional hassle of refinancing to another lender.
“The average interest rate paid on newly-drawn mortgages increased slightly by 7 basis points to 4.74%, reflecting some higher mortgage pricing on the back of rising swap rates.
“Since then, inflation has moved closer to its 2% target, making an interest rate cut increasingly likely.”
Spicerhaart and Just Mortgages chief executive John Phillips points out: “The slight fall from 61,300 net mortgages in March to 61,100 April presents a pause in the upward momentum we’d witnessed in the housing market.
“At Just Mortgages, we’ve observed a similar trend, with activity moderating after a particularly strong March.
“This could be due to a number of factors, including potential seasonal fluctuations or buyers taking a wait-and-see approach as rising interest rates are factored into their calculations.
“Mortgage approvals remain at healthy levels overall. However, navigating this evolving market landscape requires expert guidance. With swap rates continuing to influence mortgage product pricing, securing the most suitable and competitive rates becomes even more important.”
