British lenders approved the most mortgages in 15 months during April, with consumer credit also experiencing stronger-than-expected growth. Bank of England data indicates a degree of economic resilience, despite higher borrowing costs linked to the U.S.-Israeli war on Iran. On Tuesday, the BoE reported 65,945 mortgages approved last month, up from 63,979 in March, marking the highest point since January 2025. This comfortably surpassed the 62,000 approvals economists had anticipated. Additionally, net unsecured lending to consumers rose by £1.859 billion (approximately A$3.50 billion), exceeding forecasts of a £1.7 billion increase, though slightly below March’s £1.904 billion.
However, some analysts caution this resilience may be fleeting. Paul Dales, chief UK economist at Capital Economics, suggested households might have “pulled forward” planned house purchases ahead of anticipated further increases in mortgage rates. Dales added that approvals could soon fall back, aligning with other indicators showing souring housing market sentiment since the war triggered a jump in mortgage rates. This perspective hints at potential shifts in market dynamics despite April’s robust figures.
Britain’s housing market has shown signs of slowing since “the war in Iran started in late February”. Weaker consumer sentiment and rising mortgage rates, exacerbated by the resurgence of conflict in the Middle East, have led lenders like Nationwide Building Society to report the first monthly fall in house prices since December in May. Figures from the Royal Institution of Chartered Surveyors also indicated drops in prices and buyer demand in April. Concurrently, net monthly mortgage lending, reflecting completed house purchases, fell to a net £4.368 billion (approximately A$8.20 billion), the lowest since October 2025 and down from £6.833 billion in March, further reinforcing observations of a cooling market.
