The Council of Mortgage Lenders’ (CML) latest figures for mortgage lending (May 2015) show that whilst lending levels recovered in May compared to April, they were down compared to a year ago. First-time buyers saw a decline in lending volumes, 13% down, compared to last year, but up slightly (3%) on the previous month, with total May loans estimated to be around £3.4 billion.
Home mover lending saw a similar trend with volumes up slightly (2%) on April but down by 12% year-on-year, with the month’s loan figures estimated as £5.0 billion. The May level of Remortgage loan figures showed a 10% decline from the level in the previous month, but were slightly up year-on-year by an estimated 3%.
The published figures show that Buy-to-Let continues to grow year-on-year, mainly driven by remortgage activity, increasing by 36% from the 2014 figure. However the May 2015 figures saw only a slight month-on-month increase from the April level. This was stated to be due to higher buy-to-let house purchase lending activity, worth £1.2 bn.
Paul Smee, director general of the CML, commented:
”House purchase lending in May was slightly up on the previous month, suggesting the market might be waking up after a subdued first quarter. Activity has broadly been down on last year but we expect it to rise in the summer months as, with historically low interest rates and a competitive lending environment, borrowing conditions are relatively favourable. But we cannot ignore the continuing affordability constraints caused by high house prices relative to earnings which will work in a contrary direction.”
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