CML: Remortgage lending picks up in the New Year
Lending declined by a quarter from December for first-time buyers (26%) and homemovers (24%) by volume, although buy-to-let lending increased by 6%.
Paul Smee, director general of the CML, said: “The traditional beginning of year seasonal lull in lending is slightly more prominent in house purchase lending than in previous years, especially in comparison to the particularly strong levels at the start of 2014.
“Affordability constraints remain a factor for would-be borrowers, but we are still projecting lending to pick up over the next few months.
“Increases month-on-month in remortgaging, both for home owners and in the buy-to-let market, are welcome given the recent static nature of remortgage activity.
“Interest rates are looking unlikely to go up in the very near future and the greater availability of good mortgage rates has probably motivated people to look at a change.”
In January there were 19,000 loans advanced to first-time buyers, 22,400 to homemovers, 25,600 to remortgage customers and 18,200 for buy-to-let.
Buy-to-let remortgaging achieved strong monthly results, as 11,400 loans were issued in January totalling £1.5bn, up 28% and 11% month-on-month respectively.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Buy-to-let continues to go from strength to strength and interest in the sector is set to continue when pension rules are relaxed next month.
“A combination of cheap mortgage rates, easing criteria, plenty of demand from tenants and poor savings rates, are convincing many that investment property is the sensible home for their money.”