Net mortgage applications for home purchases, which is an indicator of future lending, fell by 500 to 64,500 in November, according to the latest Money & Credit data from the Bank of England.
In contrast, approvals for mortgage refinancing (which only relates to refinancing a mortgage with another lender) rose by 3,200 to 36,600 in November.
Net residential mortgage debt rose to £4.5 billion in November, after falling from £1 billion to £4.2 billion in November. October.
In November, gross lending fell by £0.6 billion to £23.7 billion, while gross repayments fell by £3.1 billion to £19.4 billion. The annual growth rate of net mortgage lending rose to 3.3% in November from 3.2% in the previous month, the highest level since January 2023 (3.4%).
Commenting on the latest figures, Mark Harris, CEO of SPF Private Clients, said: “With mortgage applications falling slightly in November, the underlying resilience of the housing market is clearly visible despite the many challenges it faces.
“The effective interest rate on new mortgages rose to 4.2% after many months of declines, while the interest rate on the outstanding stock of mortgages also rose to 3.9%, highlighting that affordability remains a concern for many.
“As we enter a new year, the good news for borrowers is that lenders are eager to lend and have the money available to do so. Many of the major lenders have recently cut their mortgage rates in their bid to get off to a strong start this year, and we expect others will follow suit. Those who cannot compete on rates can instead look to improve criteria, which is also good news for borrowers.
“The number of remortgages increased, indicating that borrowers taking advantage of low interest rates are looking for the best possible rate rather than opting for the convenience of staying with their existing lender.”
OnTheMarket president Jason Tebb highlighted that intense pre-Budget speculation and the impact it could have on the housing market had impacted home purchase approvals. “Yet, approvals fell only slightly in November, underscoring the overall resilience and determination of both buyers and sellers to continue with their moves.”
He added: “With interest rates on new mortgages rising for the first time since February 2025, affordability challenges remain. The Bank of England’s base rate cut in December, with more expected to come this year, should provide further relief to borrowers. With lenders already cutting mortgage rates this month as they look to get off to a strong start, there is more good news for borrowers.”
London estate agent and former RICS residency chairman Jeremy Leaf said the latest BoE figures were particularly interesting as they set the tone for housing market activity for at least the next few months and cover a period when concerns over tax changes in the Budget were at their peak.
“Although mortgage applications fell slightly, buyers and sellers continued to demonstrate significant resilience given the level of uncertainty, which bodes well for the market.
He concluded: “Early signs this year have been encouraging, although it is too early to say with any certainty whether the relief in the absence of tax measures will have a significant impact on decision-making.”