Mortgage lending up 24% in March but down on 2016: CML

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Home buyers borrowed £11.2bn in March, up 24 per cent on February but down 19 per cent year-on-year.

This came to 61,700 loans, up 27 per cent on February but down 12 per cent on March 2016.

First-time buyers borrowed £4.9bn in the period, up 29 per cent on February and 9 per cent on March 2016.

They took out 31,500 loans, up 30 per cent month-on-month and 12 per cent year-on-year.

Home movers borrowed £6.2bn, up 19 per cent on February but down 33 per cent year-on-year.

This equated to 30,200 loans, up 24 per cent month-on-month but down 28 per cent compared to March 2016.

Remortgage

Home-owner remortgage activity was up 13 per cent by value and 14 per cent by volume on February.

Compared to March 2016, remortgage lending was up 22 per cent by value and 24 per cent by volume.

Gross buy-to-let saw month-on-month increases, up 4 per cent by value and 8 per cent by volume.

Compared to March 2016 the number of loans decreased 58 per cent and the amount borrowed decreased by 60 per cent.

The CML says this reflects the surge of activity ahead of the stamp duty reform introduced in April 2016.

End of Q1

In the first quarter home buyers borrowed £28.6bn, down 13 per cent on the fourth quarter 2016 and 7 per cent on the first quarter 2016.

This came to 156,000 loans, down 13 per cent on the previous quarter and 5 per cent on the same quarter last year.

CML director general Paul Smee says: “Overall, lending trends have remained reasonably consistent.

“The relatively sluggish activity among home-movers stands in contrast to the growth in first-time buyer and remortgage activity, but in aggregate the market is showing broadly the levels of activity we expected.

“As we head into the summer, we expect a continuation of these trends, with both first-time buyer and remortgage lending expected to maintain momentum in the light of the very attractive deals currently available.”

Private Finance director Shaun Church says: “The strong increase in lending in March is an encouraging sign the mortgage market has kicked into gear.

“While overall lending is lower than it was a year ago, this is in the context of an extremely busy March in 2016 which saw swathes of buyers trying to beat the changes to stamp duty.”