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UK mortgage approvals hit two and a half-year low as Iran war drive up borrowing costs – business live

Rolling coverage of the latest economic and financial news, as mortgage approvals for UK house purchases fell to 56,200 in MayShares in chipmakers underpinning AI boom rocket in first half of 2026The total value of new mortgage approvals also fell in May.Net borrowing of mortgage debt by individuals decreased to £2.9bn in May, down from £4.4bn in April, the Bank of England reports.“The sharp slowdown in mortgage borrowing and approvals suggests the surge in activity earlier this year has now faded, with buyers and homeowners taking a more cautious approach. While borrowing costs have eased from their recent highs, affordability remains stretched and many prospective buyers continue to contend with elevated house prices and wider cost-of-living pressures.“For lenders, the changing outlook highlights the importance of integrating forward-looking affordability assessments that better reflect real borrower behaviour and lifetime income patterns. As caution rises, these more personalised models can help to sustain housing demand over the coming months. Continue reading...