Mortgage approvals dipped slightly last month but Britons still borrowed more cash to get on the housing ladder, according to new figures.
Savers also invested a record amount into ISAs for the month as households seek to benefit from 16-year-high interest rates.
Bank of England data released on Friday has revealed that there were 61,100 mortgage approvals for house purchases in April.
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— Mark Harris, SPF Private Clients
This represented a slight drop from the 61,300 recorded in March, which had been the highest level since September 2022 amid signs of increased activity in the UK housing market.
It came after mortgage rates edged slightly higher in April as some lenders pushed back expectations for when the Bank of England will next reduce interest rates from their current rate of 5.25%.
Approvals for remortgaging also decreased to 29,000 for the month, from 33,500 in March.
However, there was an increase in net mortgage borrowing for the month, up to £2.4 billion of mortgage debt from £0.5 billion a month earlier.
Meanwhile, consumer credit borrowing decreased to £0.7 billion in April from £1.4 billion, as households spent less on credit cards.
The data also found that households’ holding of money increased by £8.4 billion for last month.
This came as households deposited £11.7 billion into ISAs, the highest for the savings account since records began in 1999.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “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.
“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.”
