CML reports year-on-year rise in remortgage lending

Posted on Friday, July 15 by Joy Tibbs

According to figures from the Council of Mortgage Lenders (CML), remortgage activity totalled £5.2 billion in May, down 15% in value compared with April but up 30% compared with May 2015 figures.

The number of remortgage loans approved in May totalled 30,900 loans, down 12% month-on-month but up 25% compared with the previous May.

Homeowners borrowed £9.4 billion for house purchase, up 15% month-on-month and 8% year-on-year in value terms. Homeowners took out 53,800 loans, up 13% on April and 5% on May 2015.

First-time buyers borrowed £4.3 billion, up 10% compared with April and 23% compared with May 2015. This equated to 27,500 loans, up 9% month-on-month and 16% year-on-year.

Home movers borrowed £5.1 billion, up 19% on April but down 2% compared with May 2015. This represented 26,300 loans, up 18% month-on-month but down 5% on May 2015.

Landlords borrowed £2.6 billion, up 4% month-on-month but down 4% year-on-year. The number of loans totalled 16,600, up 3% compared with April but down 8% compared with May 2015.

Paul Smee, director general of the CML, said: “There was a sense of the market regaining some equilibrium in May, following the stamp duty driven spike in March and the subsequent dip in April. For the second month running, first-time buyers borrowed more than home movers, the first time in 20 years that this has been the case. Buy-to-let continues at lower levels as expected, after the change to stamp duty.

“Brexit, and its likely effect on the market, is a question to which the answer will not immediately be forthcoming. Lenders will continue to be open for business as usual, but lending volumes may be affected by uncertain consumer sentiment.”

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