Expectations of tax increases dragged down the market's demand for UK mortgages to a five-month freezing point

The Zhitong Finance App noticed that demand for housing loans in the UK fell to its lowest level in five months because buyers waited and waited before the Labor Party released a tax increase budget.

The Bank of England said on Monday that the number of mortgage approvals in November fell from 65010 last month to 64530. Although this number is the lowest since June, it is still higher than economists' expectations of 64,000 cases.

The number of mortgage approvals is slightly below pre-COVID-19 levels

In the financial report of November 26, 2025, Chancellor of the Exchequer Rachel Reeves announced new taxes on properties worth more than £2 million (about US$2.7 million), which account for only a fraction of the total housing stock in the UK. The government also raised taxes by £26 billion, but most of the effects will begin to be felt in the next few years.

Bank of England data further proved that pre-budget speculation had a slight dampening effect on the housing market. Another report released by the British Mortgage Association last week showed that housing prices fell unexpectedly in December.

According to another data, consumers added £2.1 billion in unsecured debt in November, the highest level in two years and double the market's expectations. This increase was mainly driven by credit card borrowing, which increased £300 million to £1 billion.