Mortgage borrowing spiked £3.2bn in May

A rush to lock in low borrowing costs sparked the biggest rise in mortgage lending in eight months as net mortgage lending leapt to £7.4bn in May, up from £4.2bn the previous month, despite a jump in interest rates for borrowers, new Bank of England data showed. The data revealed that borrowers suffered the biggest six-month surge in mortgage rates in a decade. Average interest rates on a new mortgage have jumped almost 50 basis points in six months and rose a further 13 basis points in May to 1.95%. The rate on the outstanding stock of mortgages ticked up two basis points to 2.07%. The number of mortgages approved for house purchases ticked up to 66,200 in May, from 66,100 in April. This was below the 12-month pre-pandemic average up to February 2020 of 66,700. Approvals for remortgaging were unchanged at 47,800 in May, below the 12-month pre-pandemic average up to February 2020 of 49,500 - but these statistics only reflect those remortgaging with a different lender and the number entering a new deal with their existing lender is likely much higher. Daily Mail The Daily Telegraph