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TODAY'S OTHER NEWS

Mortgage lending plunges almost 30% in April

Gross mortgage lending fell 29% in April following the rush to beat the new stamp duty surcharge on buy-to-lets and second homes.

April’s total lending figure of £18.5 billion was well down on March's total of £26.2 billion, but was still 16% higher than the £16 billion lent in April last year.

This was also the highest lending total for April since 2008, according to new figures from the Council of Mortgage Lenders.

CML economist Mohammad Jamei said buy-to-let is set to take a back seat with lending driven by first-time buyers, movers and remortgage customers.

“The underlying picture still shows signs of growth, as the market remains underpinned by strong fundamentals such as increasing wages and rising employment.

“But it is possible that the uncertainty around the upcoming EU referendum in June will weigh on activity in the upcoming months.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said April's dip was expected. “The buy-to-let sector is now likely to pause for breath as investors consider their next move, possibly later in the year.

“That said, we don’t expect to see a significant slowdown in activity on the residential side.”

Jeremy Duncombe, director, Legal & General Mortgage Club, said that although annual lending figures were rising strongly this is partly due to the fact that people were being forced to borrow larger amounts to keep up with “unsustainable” rises in property prices. 

David Brown, chief executive of Marsh & Parsons, said: “Buy-to-let investors are just one type of buyer and borrowing isn’t going to ground to a halt while they have a breather.”

  • Richard White

    So the real story here is that mortgage lending has stayed strong and broadly returned to pre March figures. In other words, the huge collapse in lending forecast by the Private Frazer brigade has not materialised (yet). Nothing to see here folks, move along.

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