Buy-to-let was the only part of the mortgage market to grow year-on-year in April as owner-occupied lending continued its slow start to the year.
According to the Council of Mortgage Lenders, there were 17,200 buy-to-let loans in April, up 18.6 per cent on the 14,500 loans a year earlier. By value, buy-to-let lending totalled £2.5bn, up from £1.9bn in April last year.
Remortgage lending slumped again after recovering in March. There were 25,200 remortgage loans in April, 10 per cent fewer than the 28,000 the previous April. Gross remortgage lending was down £100m at £4.2bn.
The number of loans for house purchase was down 10.2 per cent, from 53,700 in April 2014 to 48,200 in April this year. By value, house purchase lending fell from £8.9bn to £7.4bn over the period.
CML director general Paul Smee says: “House purchase lending in April was relatively subdued compared to last year, but similar to activity in March. The economy is recovering, with employment up, earnings growing, and competitive mortgage rates, so we expect activity to continue building as the year progresses.
“Buy-to-let is showing stronger growth than home-owner lending, buoyed significantly by remortgaging, which continues to remain more subdued in the home-owner market.”
SPF Private Clients chief executive Mark Harris says: ”Caution in the housing market prevailed during April, with lending at a similar level to March but down on the same month last year. Uncertainty created by the general election played a significant part in encouraging buyers and sellers alike to sit on their hands until the outcome was known.
“The way in which lenders have been cutting mortgage rates ever lower confirms this hiatus. Many lenders are keen to lend and have ambitious targets for the year but with borrowers unwilling to commit, they are having to slash rates even further to attract business.”