Residential  

Mortgage lending falls in January

Mortgage lending falls in January

Gross mortgage lending across the residential market in January 2019 was £21.6bn, some 1.5 per cent down on the same month in 2018, according to UK Finance.

The number of mortgages approved by the main high street banks in January 2019 was 0.3 per cent more than the same month the previous year, the trade body for mortgage lenders reported,

Approvals for home purchase were 1.5 per cent up in January, remortgage approvals were down 3.1 per cent and approvals for other secured borrowing were 6.8 per cent greater.

According to UK Finance, this follows several months of strong growth in remortgaging earlier in 2018, as customers took advantage of a competitive mortgage market to lock into attractive deals.

Richard Pike, sales and marketing director of Phoebus Software, said while overall lending in January was 1.5 per cent down on the same month last year more starkly it was 9 per cent below the previous six-month average. 

He said: "We are not very often surprised by the figures these days, and to be honest the picture the figures paint for January is probably more encouraging than we might have hoped. 

"Unfortunately, there is nothing going on in Westminster or in Europe that is helping to alleviate the situation, and neither will it for some time. 

"However, there is a resilience that shows there are still people that want, and need, to buy and nothing in the political arena will change that. 

"The next few months will be telling, we could be looking at an even less rosy picture in a couple of month's time, or we will see that despite uncertainty people carried on regardless."

Dilpreet Bhagrath, mortgage expert at online mortgage broker Trussle, said it is clear that current economic uncertainty is casting a shadow over the property market.

She said: "Those hoping to move seem to be most affected, adopting a wait-and-see approach while Brexit looms.

"Remortgaging activity is also down slightly, but is continuing to tick over as expected as many homeowners seek to lock in a fixed-rate deal with a view to riding out any potential rate rises linked to Brexit.

"The ongoing shortage of available homes is limiting options for buyers in some areas, but there are some good deals to be had particularly for first-time buyers who are ready to move quickly.

"Those who do find their dream home might want to consider a fixed-rate mortgage if they want to know exactly how much they'll be paying each month, avoiding instability and providing extra piece of mind."

emma.hughes@ft.com