Latest Bank of England Mortgage Lenders statistics
The latest Bank Of England Mortgage Lenders and Administrators Statistics for Q1 have been hailed as a positive sign of the market, according to experts.
The outstanding value of all residential mortgage loans increased by 0.7% from the previous quarter to £1,746.1bn, 2.6% higher than a year earlier, while the value of gross mortgage advances decreased by 12.3% from the previous quarter to £69.6bn, 10.2% lower than a year earlier. The value of new mortgage commitments increased by 11.5% from the previous quarter to £78.0bn, 14.2% higher than a year earlier.
‘Just a mirage’
Rob Clifford, chief executive of Stonebridge, said: “It looks like a contraction and an expansion at the same time if you look at what happened to lending and new commitments in the first quarter, but these wild swings in the numbers are really just a mirage. Ignoring the annual figures this time around is the only way to take the temperature of the market, all thanks to a distortion last year.
“A stamp duty cliff edge had caused a rush of applications and lending, creating both flattering and unflattering year-on-year comparisons. However, there’s still plenty of momentum out there. In fact, despite the invasion of Iran in February, new mortgage approvals are holding their own and were up significantly the very next month, also rising year on year.”
He said the market was also still in the midst of a remortgaging wave after the pandemic boom in transactions five years ago. “This will smooth out the effect of any volatility for advisers who position themselves well in the coming months,” he said.
Arrears continue downward trend
Richard Pike, chief sales and marketing officer at Phoebus Software, said he was encouraged that arrears continue to trend downwards, at their lowest since Q3 2023 and down 1.7% from the previous quarter to £20.1bn, 6.3% lower than a year before.
“This highlights the resilience of borrowers despite ongoing affordability pressures and will provide reassurance to lenders that, while cost pressures persist, most customers are managing to stay on top of their repayments.”
Meanwhile, Mary-Lou Press, NAEA Propertymark president, said it was encouraging to see a modest increase in the share of buy-to-let mortgage advances (up 0.5pp from the previous quarter to 8.9% and 0.8pp higher than a year ago) despite significant legislative changes affecting landlords across the UK.
“However, many property investors remain cautious about the impact of reforms such as the Renters’ Rights Act and the Housing (Scotland) Act, and it remains to be seen how these changes will influence investment decisions over the longer term,” she said.
