The Council of Mortgage Lenders (CML) has revealed that first-time buyers saw a drop in lending in January compared to December and the same month in 2014.
There were 19,000 loans advanced to first-time buyers January – down 27% on December and 14% compared to January 2014. These loans by value were £2.8 billion, which was down 26% on December and 10% down on January last year.
Home movers were advanced 22,400 loans, a decline of 24% compared to December and 17% down year-on-year. These loans totalled in value £4.2bn – 24% down on December and 14% down compared to January 2014.
Remortgage lending increased month-on-month with 25,600 loans advanced – up 15% on December but 12% down on January 2014. The value of these loans (£4.1 billion) also increased month-on-month by 21% but was down 5% year-on-year compared to January 2014.
There were 18,200 buy-to-let loans in January – up 6% on the previous month and up 12% on the same period in 2014. These loans came to £2.5bn in value, unchanged compared to December but up 14% on January 2014.
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.”
As previously reported, gross mortgage lending reached £14.8 billion in January. This represents an 11% decrease from December’s gross lending total and is 8% lower than lending in January 2014.
