Mortgage approvals resilient in June

The increase in total net lending to individuals in June (£10.4 billion) was higher than the increase in May and the previous six-month average, according to the Bank of England (BoE).

The twelve-month growth rate was unchanged from May at 10.2%. The three month annualised growth rate fell by 0.1 percentage points to 9.2%.

Within the total, the increase in net lending secured on dwellings (£9.6 billion) was above the increase in May and the previous six-month average. The twelve-month growth rate was unchanged from May at 11.2%. The three month annualised growth rate fell, by 0.1 percentage points to 10.2%. The number of loans approved for house purchase (114,000) was unchanged from May; those for remortgaging (102,000) and other purposes (72,000) were lower than in May.

The increase in net consumer credit in June (£0.9 billion) was in line with that in May. Net credit card lending rose by £0.2 billion compared with a fall of £0.2 billion in May. Net other loans and advances rose by £0.7 billion (lower than the increase of £1.1 billion in May). The annual growth rate of consumer credit was unchanged from May at 5.2% and the three-month annualised growth rate increased by 0.4 percentage points to 4.2%.

Commenting on the Bank of England mortgage approvals data, RICS Chief Economist Simon Rubinsohn said: "The volume of mortgage approvals may have proved more resilient than expected in June but as recent interest rate increases get fully passed through into borrowing costs, we expect to see more evidence of a cooling in demand for property. Significantly, the latest numbers point to a modest drop in the level of re-mortgage activity. This suggests that homeowners may just be becoming a little more wary of continuing to draw on the equity that has built up in their property as a means of financing spending at a time when real incomes growth remains under pressure."