UK mortgage approvals rose higher than expected last month while lending volumes also increased, reaching their strongest levels since September 2022 and pointing to a recovery in the housing market.

Approvals increased to 62,000 in July, according to Bank of England data published on Friday.

The figure was an increase from the 60,600 approvals recorded in June and points to an improving housing market, the BoE said.

Net mortgage lending, meanwhile, reached £2.8bn in July, also the highest level since 2022, compared with £2.6bn in June.

The latest house price data from lender Nationwide, also published on Friday, showed house prices rose in August at their fastest pace since late 2022.