Homebuyer lending slowed in April following a surge during the previous month amid signs of a ‘one-sided’ housing market.
The total amount borrowed by homebuyers during April was £9.6bn – down 14 per cent on March but up 19 per cent on an annual basis, according to the Council of Mortgage Lenders (CML).
Lending to first-time buyers was down 16 per cent to £4.1bn but up 8 per cent year-on-year, while home movers borrowed £5.5bn – down 11 per cent month-on-month but up 28 per cent on an annual basis.
Home-owner remortgage activity fell on both a monthly and annual basis, while gross buy-to-let declined on a monthly basis and remained flat year-on-year.
On a seasonally adjusted basis, lending to first-time buyers and home movers went up by value and remained relatively unchanged by volume compared to March.
Buy-to-let and remortgage activity also remained relatively unchanged in April from March.
Value of loans for house purchase and remortgage in April
| House purchase (£m) | Remortgage (£m) | ||||
| FTBs | Movers | Buy-to-let | Home owners | Buy-to-let | |
| Apr-16 | 3,800 | 4,300 | 600 | 6,000 | 1,900 |
| Mar-17 | 4,900 | 6,200 | 900 | 6,100 | 1,900 |
| Apr-17 | 4,100 | 5,500 | 800 | 5,100 | 1,700 |
| 1 month change | -16.30% | -11.30% | -11.10% | -16.40% | -10.50% |
| 12 month change | 7.90% | 27.90% | 33.30% | -15.00% | -10.50% |
CML director general Paul Smee said: “April comparisons are distorted by the weakness last year following the Stamp Duty changes and the normal seasonal lending surge in March.
“But the seasonally-adjusted picture shows lending relatively unchanged month-on-month across all lending segments.
“Heading into the summer months, we expect the market to remain slightly lopsided. Buy-to-let and home movers may well remain subdued, as they have been for the last six months.
“But both first-time buyer and remortgage lending should maintain momentum on the coattails of the attractive deals available.”
Alastair McKee, managing director of UK-wide independent mortgage broker One 77 Mortgages, commented: "The market is less lopsided than one-sided. Against a backdrop of cheap loans, Help to Buy and significantly reduced competition from landlords, first-time buyers are having a field day.
"With many landlords still reeling from the raft of tax and stress-testing changes, first time buyers see an opportunity and are taking it.
"First time buyers are finally able to compete with landlords and the signs are that demand will remain strong throughout the year.”
simon.allin@ft.com
