Home buyers in London borrowed £5.5bn for home-owner house purchase, down 23 per cent quarter-on-quarter and 3 per cent on a year ago, according to the Council of Mortgage Lenders.
However, first-time buyers across the UK borrowed £3bn, up 3 per cent on the first quarter and 10 per cent compared to the second quarter last year.
Home movers borrowed £2.5bn, down 41 per cent on quarter one this year and 14 per cent compared to a year ago. Remortgage activity totalled £4.3bn, up 6 per cent on the first quarter 2016 and 29 per cent compared to a year ago.
Paul Smee, director general of the CML, said first-time buyers have continued to drive mortgage lending in London, while the opposite is true for home movers, “probably just reflecting a rebalancing after the very strong first quarter as many buyers sought to complete purchases before changes to stamp duty”.
He noted the second quarter data largely pre-dates the EU referendum. “While it will take time to see how Brexit may affect the market, the London mortgage market clearly remains active and firmly open for business.”
In Scotland, home buyers borrowed £2.2bn for house purchase, up 23 per cent quarter-on-quarter, but down 1 per cent year-on-year.
First-time buyers borrowed £920m, up 42 per cent on the first quarter and 2 per cent on the second quarter last year.
Home movers borrowed £1.2bn, up 11 per cent quarter-on-quarter, but down 5 per cent compared to a year ago, while remortgage activity totalled £850m, up 9 per cent both on the first quarter 2016 and the second quarter 2015.
Carol Anderson, CML’s Scotland chair, explained this is the 19th successive quarter of growth in first-time buyers compared to a year earlier, and the highest quarterly number of first-time buyer loans since mid-2007.
Welsh home buyers borrowed £920m for house purchase, up 8 per cent quarter-on-quarter and 11 per cent year-on-year.
First-time buyers in the country borrowed £420m, up 31 per cent on the first quarter and 24 per cent on the same period last year.
Home movers borrowed £490m, down 6 per cent on the first quarter of the year, but unchanged compared to the same period in 2015. Remortgage activity equated to £450m, up 7 per cent on the previous quarter and 18 per cent compared to a year ago.
CML Cymru’s chair Julie Ann Haines said lending in the second quarter saw highest quarterly volume of first-time buyer loans since mid-2007 and the highest volume of remortgage loans since mid-2013.
“Home mover lending dipped slightly but this was most likely simply a rebalancing after the previous quarter’s rush ahead of the stamp duty changes in April,” she added.
Finally, in Northern Ireland, home buyers borrowed £350m for house purchase, up 3 per cent quarter-on-quarter and 13 per cent year-on-year.
First-time buyers borrowed £200m, up by a quarter on the first three months of this year and up by a third on the second quarter last year.
Home movers borrowed £150m, down 17 per cent quarter-on-quarter and 6 per cent compared to a year ago, while remortgage activity totalled £210m, up 24 per cent on both the first quarter of the year and the same quarter last year.
Derek Wilson, CML Northern Ireland’s chair, stated this is the best performing second quarter of a year for house purchase lending in Northern Ireland since 2007, with first-time buyers really driving that rise in activity.
peter.walker@ft.com
