Remortgage lending had its best month in five months in April, helping to boost gross lending by 5 per cent, according to figures released today by the Council of Mortgage Lenders.
A total of £3.4bn was advanced to borrowers remortgaging in April, up 9.7 per cent on the £3.1bn advanced in March.
While remortgaging figure was 2.9 per cent down on the £3.5bn advanced in April 2012, it was the highest figure since November last year when £3.4bn was advanced to remortgage borrowers.
The CML reported its total gross lending figures last month, showing April had experienced its strongest month since 2008. The 4.3 per cent increase in gross lending from £11.6bn to £12.1bn in April, was in part due to the strength of remortgage lending, according to the CML.
First-time buyers took out 19,400 loans, worth £2.5bn, in April, down 1 per cent on the 19,600 loans, worth £2.5bn, in March.
In the first four months of the year, 70,700 loans were advanced to first-time buyers, which was 11 per cent stronger than the 63,500 loans advanced to these borrowers over the same period a year earlier.
Activity in the first four months is even more impressive when you consider last year’s figures are likely to have been boosted by the ending of the stamp duty holiday, says the CML.
Around 46 per cent of all house purchase loans were advanced to first-time buyers in April, which was unchanged from March but considerably higher than the 38 per cent average seen since 2007.
In April, the average loan-to-value edged up to 81 per cent from 80 per cent in April, indicating there have been more transactions at higher LTVs.
A total of 23,500 loans, worth £3.8bn, were advanced to home movers in April, down by 1 per cent in volume and 3 per cent in value compared to March.
The value of home purchase lending remained at £6.3bn in April, although the number of loans dipped from 43,000 to 42,600 in April.
CML director general Paul Smee says: “Lending to first-time buyers remains above the levels seen at the same time last year, despite the boost caused by the end of the stamp duty holiday in March last year.
“The Help to Buy scheme announced in this year’s Budget should provide a further boost to the first-time buyer and home mover markets, but we still await further details on how the initiatives will work.”