Gross mortgage lending in March was 33 per cent than the same month last year, reaching £15.4 billion, according to figures from the Council of Mortgage Lenders.
Figures for March 2014 were also up by 4 per cent compared to the previous month.
Gross mortgage lending for the first quarter of this year was therefore an estimated £46.3 billion. This represents a 10 per cent decrease from the last three months of 2013, but a 37 per cent increase on the first quarter of 2013 (£33.8 billion).
Commenting on market conditions, CML chief economist Bob Pannell, observes: “Alongside benign developments in the wider UK economy and the labour market, housing market sentiment continues to strengthen.
“There are currently no signs of significant market disruption, arising from the imminent application of new lending rules associated with the Mortgage Market Review. While some mortgage lending indicators have eased back gently, this is from the very high levels of recent months.
“The Financial Policy Committee continues to be vigilant to housing market developments, and to remind the market of its ability to act before problems to financial stability set in.”
Richard Sexton, director of e.surv chartered surveyors, commented: “Gross lending is continuing its steady growth, as the economic recovery percolates through the entire mortgage market. Help to Buy is supporting the bottom of the market by making mortgages more accessible, and banks are more willing to lend to borrowers with smaller deposits. One in six loans are now to high loan-to-value borrowers, meaning it is now relatively easier for first-time buyers to tap into the property market.
“But the new MMR regulations will ensure that even as lending is increased, the recovery remains responsible. Borrowers will be stress tested to make sure they can afford future interest rate rises. Now wage growth has overtaken inflation, a base rate rise may happen sooner than originally thought. That will be the next big move for lending, and we may see a temporary slowdown as banks adjust to the new, tighter rules.”
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