UK Mortgage Rates Fall For First Time Since 2021

Net mortgage approvals for house purchases rose from 49,300 in November to 50,500 last month — the highest reading since June…reports Asian Lite News

UK average mortgage rates fell for the first time in over two years, according to data from the Bank of England, suggesting that the burden on homeowners is easing as lower borrowing costs filter through.

The data, released on Tuesday, adds to signs of stabilisation in the property market as mortgage approvals rose for the third consecutive time to a six-month high in December.

The BoE data also showed the “effective” interest rate — the actual interest paid — on newly drawn mortgages fell by 6 basis points to 5.28 per cent in December, marking the first drop since November 2021.

“There are green shoots of a recovery in the housing market and perhaps the wider economy,” said Ashley Webb, economist at the consultancy Capital Economics. 

Net mortgage approvals for house purchases rose from 49,300 in November to 50,500 last month — the highest reading since June.

Meanwhile, net approvals for remortgaging also increased from 25,700 in November to 30,800 in December, in a further sign that activity is returning to the property market.

Mortgage approvals offer an early indication of the health of the housing market. The latest figures will be closely monitored by policymakers ahead of the upcoming BoE Monetary Policy Meeting on Thursday.

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