KPMG UK has indicated that the latest Bank of England data on money and credit for April 2026 reveals a nuanced picture of household borrowing trends, with mortgage activity highlighting both resilience in parts of the housing market and growing pressures on affordability. KPMG UK added that net mortgage borrowing by individuals fell notably to £4.4 billion, down from £6.8 billion the previous month and below the six-month average of £5.1 billion.
This decline comes as broader economic sentiment among UK households appears to be softening.
Karim Haji, Global and UK Head of Financial Services at KPMG, offered insights into these figures.
He noted that the reduction in mortgage borrowing aligns closely with a recent dip in consumer confidence, which reached its lowest level since October 2023.
This reflects heightened concerns about the overall state of the UK economy and personal financial situations. Households seem more hesitant to take on new debt amid these worries.
Yet the data is not uniformly negative. Mortgage approvals for home purchases rose to 65,900 in April, exceeding the recent six-month average of around 63,100.
Haji pointed out that this uptick points to continued optimism, particularly among first-time buyers who remain keen to enter the property market.
Their determination suggests that demand for initial homeownership stays relatively robust despite wider challenges.
In contrast, activity in remortgaging appears to have eased. This softer trend indicates that many existing homeowners are exercising greater caution.
With interest rates still elevated following the Bank of England‘s policy decisions, refinancing decisions may feel less attractive or more burdensome for those already on the property ladder.
The divergence between first-time buyers and experienced / veteran homeowners underscores uneven confidence levels across different segments of the market.
Haji highlighted potential headwinds. Inflation is expected to climb again in the coming months, driven by rising energy and food costs.
Fiscal measures from the government offer limited relief, leaving many families to navigate affordability strains on their own.
As a result, more households may increasingly rely on lenders to bridge gaps in managing everyday expenses and debt obligations.
Consumer credit borrowing remained steady at £1.9 billion in net terms, matching the average of the prior six months.
This stability suggests that while consumers are not actually rushing to accumulate additional unsecured debt, they are also not pulling back dramatically.
Combined with mortgage trends, it paints a picture of a financial system where cautious navigation prevails.
These developments occur against a backdrop of steady Bank Rate at 3.75% and inflation hovering above target, influenced by global factors including energy market volatility. The housing / property market sector demonstrates resilience in approvals but tempered overall lending flows.
For lenders and policymakers, the data signals a need to monitor how evolving cost-of-living pressures and economic perceptions will shape borrowing behavior in the second half of the year.
The April statistics reflect a UK borrowing landscape marked by selective confidence—strong among new entrants to homeownership but guarded elsewhere.
As inflationary risks re-emerge and support remains constrained, households’ interactions with credit providers will likely stay a key barometer of economic health. KPMG has concluded that financial institutions may need to adapt offerings to address these shifting dynamics, strategically balancing sustainable growth opportunities with proper risk management.
