New data from the Council of Mortgage Lenders showed that home lending fell in September, but enjoyed record growth across the preceding three months. Activity softened in September, as the UK property market moderates amid cautious buyers and cooling prices, but activity is still higher than a year ago.
First-time buyers saw a month-on-month lending decline for the second month in a row, with 26,800 first-time buyer loans in September – 3 per cent fewer than in August, but 16 per cent up on September 2013. By value, there was £4 billion advanced to first-time buyers in September – 2 per cent down on August but 25 per cent higher than September last year.
Lending to home movers also weakened month-on-month for the second month in a row. In September, the number of loans advanced to movers was 31,700, a 10 per cent fall on the previous month but up 11 per cent on September last year. By value, lending to movers totalled £6 billion, 12 per cent down on August but up 18 per cent on September last year.
Remortgage lending activity saw an increase month-on-month in September, with the number of remortgage loans totalling 28,300. This was 20 per cent up on August but 12 per cent down on September last year. The value of these loans (£4.4 billion) was up 22 per cent on the previous month but down 6 per cent on September last year.
There were 18,100 buy-to-let loans in September, representing lending of £2.5bn. Following the August low of 15,700 loans worth £2.2 billion, this returned buy-to-let lending to levels very similar to July, up 24 per cent by volume and 32 per cent by value on September last year.
Brian Murphy, Head of Lending at Mortgage Advice Bureau (MAB), says the UK mortgage “continues to go from strength to strength”, as conditions improve for consumers.
Paul Smee, director general of the CML, says they mark the culmination of a year of “transition and growth”.
“This has been a year when lenders and intermediaries have been put under increased spotlight from regulatory, political and media spheres and have risen to meet the challenges,” comments Smee. “The lending market is healthier than it was a year ago, and set to remain so. Remortgaging has returned as a driver of lending volume in the buy-to-let sector. But any fears of over-heating in the housing market are now dissipating as house purchase lending activity seems to be softening.”
Source: The Movechannel