Mortgage approvals for UK house purchases fell to 54,918 in August, their lowest monthly total since December 2023, as higher borrowing costs deterred buyers. The article links rising mortgage rates to the Iran war’s effect on oil prices and inflation, which has also weakened expectations of interest rate cuts.

The effective rate on newly drawn mortgages rose from 4.45% in July to 4.60% in August, while remortgage approvals slipped to about 34,000 from 34,600. Moneyfacts said average five-year fixed rates reached 5.94%, their highest since October 2023, and two-year fixes rose to 5.93%, the highest since July 2024. Analysts said ongoing affordability pressures could weigh more on housing activity than the government’s new first-time buyer scheme.