Remortgage boom pushes gross lending to £23.1bn: UK Finance

Gross mortgage lending rose to £23.1bn in October according to the latest figures from UK Finance, boosted by a rise in remortgaging.

This figure compares to the £21.4bn lent in September.

The data shows that while remortgage remained buoyant, there were also increases in the number and value of mortgages to first-time buyers, home movers and landlords.

Along with remortgaging, these sectors showed month-on-month increases and year-on-year.

The non-seasonally adjusted data shows that remortgage activity totalled £7.3bn in October, up 15.9 per cent on September, and 17.7 per cent higher than a year ago.

This corresponds to 41,100 remortgage an increase of 16.1 per cent on September and a twelve-month change of 16.4 per cent.

First-time buyers borrowed £5.1bn, up 2 per cent on the previous month, and 13.3 per cent higher than lending to first-time buyers in October 2016. This equated to 31,700 loans, up 3.6 per cent on the previous month and a 10.5 per cent increase compared to a year ago.

Home movers borrowed £7bn, up 2.9 per cent on September and 18.6 per cent higher year-on-year. There were 33,300 home movers, and increase of 5 per cent on September’s figure and a 15.6 per cent increase on October 2016.

Buy-to-let remortgaging totalled £2.4bn, up 20 per cent on September 2017, and October 2016. Remortgaging now accounts for just over 70 per cent of all buy-to-let lending.

There were 14,700 buy-to-let remortgages in October, a 20.5 per cent increase on September, and a 21.5 per cent annual increase.

UK Finance head of mortgage policy June Deasy says: “Over the last year, the number of loans for remortgaging have been at record levels; this trend looks set to continue further as we head towards the end of 2017, and borrowers seek to take advantage of low interest rates.

“Mortgage repayments as a proportion of income still remain at, or close to,  historic low points, and despite the recent base rate rise we can expect monthly mortgage payment to remain affordable for the vast majority of borrowers.”

For home movers average capital and interest payment have remained stable at 17.5 per cent of income, unchanged on the same month last year. The loan to income ratio rose slightly to 3.41, up from 3.38 a month earlier.

For first-time buyers the situation has slightly improved, with capital and interest payments as a percentage of income standing at 17.2 per cent. This is slightly lower than September (down 0.1 percentage point) and down 0.4 percentage points compared to a year ago. However the loan to value ratio rose slightly, with an increase of 0.6 percentage point on September.



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