The Council of Mortgage Lenders (CML) has revealed that, on a non-seasonally adjusted basis, home buyers borrowed £11.2bn in March, up 24% on February but down 19% on March 2016.
This came to 61,700 loans, up 27% on February but down 12% on March 2016.
First-time buyers borrowed £4.9bn for home-owner house purchase, up 29% on February and 9% on March 2016. They took out 31,500 loans, up 30% month-on-month and 12% year-on-year.
Meanwhile, home movers borrowed £6.2bn, up 19% on February but down 33% year-on-year. This equated to 30,200 loans, up 24% month-on-month but down 28% compared to March 2016.
In addition, home-owner remortgage activity was up 13% by value and 14% by volume on February. Compared to March 2016, remortgage lending was up 22% by value and 24% by volume.
Gross buy-to-let saw month-on-month increases, up 4% by value and 8% by volume. Compared to March 2016, a month which had a surge of activity ahead of the stamp duty reform introduced in April 2016, as expected the number of loans decreased 58% and the amount borrowed decreased by 60%.
The CML also reported that, again on a non-seasonally adjusted basis, home buyers borrowed £28.6bn in the first quarter, down 13% on the fourth quarter 2016 and 7% on the first quarter 2016. This came to 156,000 loans, down 13% on the previous quarter and 5% on the same quarter last year.
First-time buyers borrowed £12.3bn for home-owner house purchase, down 13% on the fourth quarter 2016 but up 10% on the first quarter 2016. They took out 78,300 loans, down 13% quarter-on-quarter but up 10% year-on-year.
In addition, Home movers borrowed £16.2bn, down 12% on the previous quarter and 18% on the same quarter last year. This equated to 77,600 loans, down 14% quarter-on-quarter and 16% compared to the first quarter 2016.
The CML said home-owner remortgage activity was up 12% by value and 11% by volume on the previous quarter. Compared to the first quarter 2016, remortgage lending was up 18% by value and by volume.
Gross buy-to-let saw quarter-on-quarter decreases, down 2% by value and 1% by volume. Compared to the first quarter 2016, the number of loans decreased 39% and the amount borrowed decreased by 40%.
Looking on a seasonally adjusted basis, first-time buyer, home mover, buy-to-let and remortgage activity remained relatively unchanged by volume and by value month-on-month. Compared to March 2016, all loan types had similar changes to the non-seasonally adjusted figures. Full seasonally and non-seasonally adjusted data is attached to this email.
Paul Smee, director general of the CML, said: “Comparing this March to last year is misleading because of the peak in activity before the stamp duty changes last Spring. Overall, lending trends have remained reasonably consistent. The relatively sluggish activity among home-movers stands in contrast to the growth in first-time buyer and remortgage activity, but in aggregate the market is showing broadly the levels of activity we expected.
“As we head into the summer, we expect a continuation of these trends, with both first-time buyer and remortgage lending expected to maintain momentum in the light of the very attractive deals currently available.”
“As expected, lending to landlords has slowed,” said Steve Olejnik, chief operating officer of Mortgages for Business. “This was the government’s aim and means that over the last 12 months buy-to-let lending by volume has dropped back to just 15% of all mortgage lending.
“This is a much healthier proportion of the total market and hopefully, will put a stop to the introduction of any further measures to curb buy-to-let, until we have had time to fully consider the new fiscal and regulatory environment being imposed on landlords.”
Ishaan Malhi, CEO and founder of online mortgage broker Trussle, added: “While the housing market may be entering a bit of a lull, the number of people remortgaging continues to grow thanks to rock-bottom rates and increasing awareness of the possible savings among homeowners.
“This is causing competition amongst lenders in the remortgage market to heat up, with TSB making notable cuts to its remortgage rates just this week. I wouldn’t be surprised if more lenders followed suit to take advantage of this growing section of the market. This will certainly be good news for any borrowers thinking about switching.”