Mortgage borrowing increased by £2.8bn in May

Latest data from the Bank of England has found that mortgage debt increased by £2.8 billion to £2.1 billion in May, following a large decrease in net borrowing of £13.8 billion to £0.8 billion in April.

The number of mortgages approved for home purchases in the UK rose to 63,000 in May, an increase of 2,400 from April and the first month-on-month rise of 2025, according.

Remortgaging approvals also increased by 6,200 to 41,500, the highest jump since February 2024. Despite less generous stamp duty relief from April, changes to lenders’ affordability assessments and stabilised mortgage rates have supported renewed confidence among buyers

Consumer credit by individuals was £0.9 billion in May, down from £1.9 billion in the previous month. Within this, net borrowing through credit cards decreased to £0.1 billion in May, from £1.2 billion in April. Net borrowing through other forms of consumer credit decreased slightly to £0.7 billion, from £0.8 billion over the same period.

Commenting on the data, Richard Lane, Chief Client Officer at StepChange Debt Charity, said “It’s always encouraging to see signs that things may be stabilising for mortgage holders after a few challenging years. However, with so much ongoing uncertainty, it’s understandable that many people still don’t feel completely secure.

“We also know that those struggling with their mortgage payments face an acute risk of financial hardship. Last year at the charity we saw mortgage arrears rise by an unprecedented 69% to an average of £10,239 per StepChange client. For those grappling with such high levels of debt, the effects are likely to be long-lasting.

“With other cost of living pressures continuing to rise, from energy and water bills to council tax and essential utilities, it’s vital that lenders remain proactive in supporting borrowers in difficulty. That support should include forbearance, alongside signposting to free debt advice as early as possible.”

John Phillips, CEO of Just Mortgages and Spicerhaart, said “Despite much doom and gloom following the change in stamp duty thresholds at the end of March, May’s rise in mortgage approvals – along with an increase in property transactions reported on Friday – shows any lull was likely only temporary. It certainly mirrors what we are seeing on the ground throughout our estate branches and the reports from our brokers, with strong demand for valuation requests, buyer registrations and mortgage appointments.

“The housing market continues to show real resilience – even in the face of stubborn inflation and some painful changes that came with the new tax year. This has been helped by continued innovation from lenders and real proactive support from advisers. Just as encouraging is a drop in net borrowing of consumer credit, which shows there is less reliance on the likes of credit cards and that hopefully the heavy financial burden felt by many households is slowly starting to ease. This all helps towards affordability and accessibility as many individuals look to turn appetite into ability with the help of their local adviser.”