The remortgage slump continued in November with the volume of loans advanced falling 16 per cent year-on-year.
Some 24,000 remortgage loans were advanced in the month, down from 28,000 a year earlier – the seventh consecutive year-on-year fall. The value of remortgage loans decreased 14 per cent from £4.1bn in November 2013 to £3.6bn a year later.
Purchase loans also fell sharply in November, with a volume of 55,600 marking a 12 per cent decline from 59,800 a year earlier. In value terms, purchase loans amounted to £9.2bn in November, down from £9.3bn 12 months earlier. On a monthly basis, purchase loans also suffered a 12 per cent fall.
CML director-general Paul Smee says: “The easing back of activity is not completely unexpected as there is usually a seasonal lending dip in the winter months and the major industry changes and more restrained market sentiment have inevitably caused month-to-month fluctuations over the last 12 months.
”Our forecasts are for gross lending to continue to grow over the next two years and this reflects our belief that there are more stable conditions in the market than a year ago.”
LMS chief executive Andy Knee says: “Remortgaging follows similar patterns, and while it’s easy to attribute the month-on-month fall to seasonality, remortgaging is down by 16 per cent from November of last year, which may be attributed to a number of factors: general market perceptions that acquiring a mortgage has become tougher after April and expectations that interest rates are set to remain low until a more robust economic recovery is established.
”Looking at the lender perspective, with MMR now bedded in, they are keen to increase business levels in 2015 and with the purchase market falling back, many lenders are providing an added emphasis to their remortgage offering.”