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UK Mortgage Approvals Hit Nine-Month High as New-Loan Rates Drop to 4.19%

Speculation over property tax changes ahead of the 26 November Budget is prompting some buyers and sellers to wait.

Overview

  • Bank of England data show 65,940 purchase approvals in September, roughly 1,000 more than in August and the highest since January.
  • The effective interest rate on new mortgages fell to 4.19% in September, the lowest since January 2023 after months of gradual declines.
  • Net mortgage borrowing rose to £5.5 billion, the strongest monthly increase since March.
  • Remortgage approvals with different lenders edged down to about 37,200, with many households nearing the end of low fixed-rate deals facing higher costs.
  • Estate agents report some paused transactions as unconfirmed reports of potential property-tax measures, including a so-called mansion tax, weigh on sentiment ahead of the Autumn Budget.