In a major boost to a stalled housing market, new figures for mortgage approvals show an increase last month.
Loans for house purchase increased by 1,000, to 65,900 in September, according to the latest Bank of England money and credit release.
Budget fears
There had been a marginal fall in August, following a leap of 800 in July, as the market adjusted to seasonal factors and fears about what next month’s Budget may mean for the property sector.
Net mortgage borrowing rose by £1.2 billion to £5.5 billion in September, the highest since March 2025 (£13.2 billion), the Bank says.
But approvals for remortgaging with a different lender decreased by 600 over the same period, to 37,200.
Wait and see
Earlier this week, figures from Zoopla revealed that the number of agreed property sales fell for the first time in two years.
The portal blamed the Budget, saying there is “a growing ‘wait and see’ attitude amongst home buyers”.
The usual pre-Christmas slowdown had started early, Zoopla said, with sales agreed down 3% year-on-year and buyer demand down 8%.
However, two years of increased sales activity had created a sales pipeline of almost 350,000 homes, which is the largest in over four years.
Industry reaction
The broker and agent
John Phillips, CEO at Just Mortgages and Spicerhaart
“While there has been plenty of talk of a holding pattern pre-Budget, today’s figures show that this isn’t the case for all borrowers.
“An increase in approvals in September demonstrates the appetite and demand that still exists in the market – whether that’s those pushing ahead with plans, or perhaps more likely, those that need to move rather than necessarily wanting to right now,” he says.
“There’s no doubt we are seeing an element of wait and see right now, which hopefully gives way to some pent-up demand once the Budget is cleared and everyone knows the lay of the land.”
The portals
Jason Tebb, President at OnTheMarket
“While speculation surrounding the Budget may have dampened an autumn bounce in the housing market, approvals for house purchases – an indicator of future borrowing – increased in September regardless, demonstrating resilience and determination from buyers and sellers to get on with their moving plans.
“With the rate on newly-drawn mortgages falling again for the seventh consecutive month, affordability challenges continue to ease,” he says.
“Although the Bank of England held rates in September, this stability, following five base rate cuts over the previous year, has helped confidence.”
Richard Donnell, Executive Director at Zoopla
“Demand for mortgages to buy homes continues to increase but at a slowing rate as the rolling total over the last 12 months starts to level off as housing transactions reach close to their 10-year average of 1.2m.
“While Budget speculation has hit demand and sales for homes over £500,000, the rest of the market is less affected which explains the continued demand for mortgages.”
The industry leader
Nathan Emerson, CEO of Propertymark
“An uplift in the number of mortgage approvals is encouraging to witness.
“Many cogs need to turn harmoniously together when it comes to consumer confidence and affordability, and despite challenges within the wider economy, it is positive to see people being able to take their next step onto the housing ladder with greater ease.
“There are still concerns which need to be acknowledged, however, such as inflation sitting close to double what the Bank of England have targeted and the influence this can have regarding base rate decisions,” he says.
“Despite this, we remain in a much stronger position than we started the year at, when the base rate stood much higher at 4.75%.”