Homebuyers make rapid post-MMR recovery
The independent mortgage broker saw mortgage applications increase by 5%.
Remortgage activity remained subdued however, as application volumes climbed by just 1% in May.
Due to the Easter break and preparations for MMR buyer application volumes saw a 7% drop back in April while remortgage activity plummeted by 12%.
Estate agent deposits stand at a seven-month high, with May’s typical buyer paying £69,238, 6% more than £65,150 in April, according to data from over 550 brokers and 900 estate agents.
Brian Murphy, head of lending at Mortgage Advice Bureau, said: “These figures clearly show the mortgage market remains open for business: homebuyers were especially quick out of the blocks at the start of the year, and though the MMR transition period added to the usual Easter dip, it has not deterred buyers from pursuing their ambitions.
“Affordability is now hard-wired into the heart of the mortgage market and it was noticeable that the average applicant in May put up significantly more of a deposit for their new home.
“This may be fine if you are moving house and have equity to draw on, but it adds to the challenge facing first-time buyers and creates even more of a need for responsible schemes such as Help to Buy, which represents a very small – but vital – part of all mortgage activity. “
Such was the nature of the recovery May was the second busiest month of the year behind March for purchase mortgage applications.
Intermediary mortgage products rose and direct-only products fell, as 163 new intermediary products were launched in May while 148 direct products were withdrawn.
Brokers have now gained 809 products in the last three months, increasing the number available by 11% through this channel since February to 8,105.
There were 319 fewer direct from lenders products in February from May, a 9% drop to 3,326.
Average 2-year tracker rates are now at their lowest since records began in June 2007, standing at 2.77%, while 5-year fixed rates rose to 4.09% from 3.96% in May 2013, moneyfacts.co.uk figures show.
Murphy added: “It will take some time to assess the full impact of the new mortgage rules, which are already directing the supply of new products through brokers.
“Until we see where the market stands, the government and Bank of England should be very wary of heaping extra constraints on mortgage activity when careful checks and balances are already in place.”