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CML: Buy-to-let lending drops 65%

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Buy-to-let borrowing dropped 65 per cent between March and April, according to figures from the Council of Mortgage Lenders.

The data shows that landlords borrowed £2.5bn in April, down 7 per cent year-on-year.

This came to 16,100 loans in total, down 64 per cent compared to March and down 10 per cent compared to April 2015.

Homeowner borrowing for house purchase was down 40 per cent between March and April to £8.1bn for the month, a drop of 4 per cent since April last year.

This was made up of 47,300 loans, down 31 per cent on March and 5 per cent on April 2015.

There was also a monthly drop in first-time buyer borrowing, down 11 per cent on March to £3.5bn but rising 15 per cent on last April.

There were 25,100 first-time buyer loans, down 9 per cent month-on-month but up 7 per cent year-on-year.

The CML said the average loan size taken out by first-time buyers dropped to £130,000 from £133,000 last month.

This was offset by the average yearly household income of borrowers also falling slightly, from £40,600 in March to £39,700 in April.

Homemovers borrowed £4.3bn, down 53 per cent on March and a fall of 14 per cent from a year ago.

This category took out 22,200 loans, down 46 per cent month-on-month and 15 per cent on April 2015.

The average amount borrowed fell to £162,995 from £180,000 in March.

CML director Paul Smee says the figures reflect a rush of investors trying to beat the March stamp duty deadline.

He says: “We expect the market to take several months to return to its previous levels after the lending surge.”

Remortgages rose 25 per cent in April and 40 per cent year-on-year.

This camp includes 34,800 mortgages.

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  • Steven Balmer 15th June 2016 at 1:21 pm

    These articles are pointless other than to state the obvious in that imposing property taxes creates a surge followed by lower activity levels. What would have been useful is receiving a sense of regional variations to understand if the increase tax on second property ownership has had the appropriate and intended consequences as a solution it was intended for within London. How about the rest of the country? Many areas have property surplice and I would like to know the net effect on these communities. What had the forecasts been and how helpful or harmful has this truly been?