Mortgage Debt Borrowing Surges as Interest Rate Uncertainty Persists

The Bank of England has released figures showing a significant increase in mortgage debt borrowing by individuals, rising to £7.7 billion in June from £3.3 billion in May.

Despite this sharp rise, net mortgage approvals for house purchases remained below their recent average, indicating that activity is still being constrained by affordability pressures and uncertainty over interest rates.

Richard Pinch, senior director at Broadstone, attributed the increase to buyers completing transactions agreed earlier in the year rather than a surge in underlying housing demand.

Melanie Spencer from Target Group disagreed, suggesting that an increase in both net mortgage borrowing and approvals shows there is still underlying demand in this market, despite a challenging backdrop.