Mortgage lending to first-time buyers and homemovers in January 2015 was lower compared to the previous month as well as to a year earlier, according to the latest figures from the Council of Mortgage Lenders (CML).
The number of loans to first-time buyers declined by 27 per cent on the month and by 14 per cent on the year to 19,000. The value of these loans totalled £2.8 billion, which was 26 per cent lower than in December and 10 per cent down on January 2014.
This was the lowest monthly level of lending to first-time buyers by both volume and value in 21 months. However, it was the second-highest January lending level since 2007 in both volume and value.
Homemovers received 22,400 loans in January 2015, down by 24 per cent month-on-month and by 17 per cent year-on-year. The total value of the loans reached £4.2 billion, which was a 24 per cent drop on December and a 14 per cent decline on January 2014.
This is the lowest monthly lending level of home mover loan volumes since March 2013 and the lowest level in terms of loan value since April 2013. Nevertheless, home mover lending was at its second-highest level for the month of January since 2008 in both volume and value.
Unlike homeowner house purchase, remortgage lending increased in January compared to December (by 15 per cent to 25,600 loans). However, the number of remortgage loans was lower than last January (by 12 per cent). The value of remortgage loans summed up to £4.1 billion, the second-highest value for the month of January since 2009. It was by 21 per cent higher than the value in December but by 5 per cent lower than last January’s figure.
Buy-to-let was the only part of the market that grew on both a monthly and an annual basis. There were 18,200 buy-to-let loans in January 2015, an increase of 6 per cent on December and of 12 per cent on January 2014. These loans came to £2.5 billion in value, flat on December but up by 14 per cent on January 2014.
Paul Smee, director general of the CML, commented:
“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.”
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