Mortgage approvals for house purchases in the UK fell sharply in May, dropping 14.9% month-on-month to 56,205, according to data released by the Bank of England.
The steep decline underscores a significant slowdown in buyer activity, suggesting that the property market is losing momentum despite earlier expectations of stabilization.
The contraction in lending activity comes at a critical juncture for the UK housing sector.
While mortgage lenders have been positioning themselves for a wave of rate reductions, consumer price inflation held steady at 2.8% in May, defying forecasts for a further decline.
This persistent inflationary pressure has kept the Bank of England on a cautious monetary path, limiting the immediate relief for borrowers and dampening demand.
The divergence between lender expectations and actual market behavior highlights the fragility of the current recovery.