Remortgaging fell by 21 per cent year-on-year in October, according to data from the Council of Mortgage Lenders.
Around 26,000 remortgage loans were advanced in October, worth £3.1bn. The number is down 9 per cent in volume and 11 per cent in value from September.
Lending for house purchases also suffered a lull in activity in October. There were 46,000 loans advanced, worth £6.7bn, which is down 4 per cent in number and 6 per cent by value from September.
There were 17,000 loans to first-time buyers in October, worth £2bn, a decrease of 5 per cent by volume and 9 per cent by value from September, and 19 per cent by volume and 17 per cent by value on a year ago.
On average, first-time buyers borrowed 80 per cent of the property’s value in October, up from 76 per cent in September. But the average income multiple to a first-time buyer declined to 3.19 from 3.26 in September.
CML director general Michael Coogan says: “With 2009 lending levels artificially inflated by the end of the stamp duty holiday, we expected to see a decline in lending year-on-year, so today’s figures are not surprising. Consumer confidence has also been affected by October’s spending review, despite the relative affordability of monthly mortgage payments, and so a stable but small lending market will continue for some time to come.”