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Gross mortgage lending was up by 13.3 per cent annually in April, according to the latest UK Finance data.
According to the data, gross mortgage lending reached £20.4 billion in April, fueled by strong remortgaging figures.
A growth in the number of total remortgage figures was also noted, up by 11 per cent. This was driven by remortgage approvals, which grew by almost 30 per cent in comparison to the previous year.
Managing director of personal finance at UK Finance, Eric Leenders, said: ‘April saw steady growth in mortgage lending and approvals, following a slowdown in activity the previous month. This was driven by strong remortgaging levels, as borrowers locked into attractive deals amid expectations of a base rate rise.’
Extending this, principal mortgage consultant at IRESS, Henry Woodcock, commented: ‘An increase in gross mortgage lending appeared likely as the April RICS survey showed new buyer enquiries and agreed sales stabilising. Even though the sale of £1m-plus houses increased to a record high in England and Wales last year, some challenges remain in the mid and upper tiers of the market and in particular, falling house prices in London.’
However, Mr Woodcock stated that there was currently no evident consensus on when the Bank of England might increase the base rate.
He continued: ‘Following the ending of its Term Funding Scheme in February, lenders are going to need to find other sources of funding. Many industry commentators have said lenders will be forced to increase mortgage rates as the ‘cheap’ money provided by the scheme runs out. And there’s some evidence this is happening already. I expect this trend of slowly increasing lender rates will continue over the Summer months. I also predict there will be a rebalancing of the market as buy to let activity diminishes further still, following stamp duty increases and tapering of tax relief for landlords. The likely mortgage winners over the next few months could be first time buyers if the recent National Landlords Association survey proves true and landlords start to downsize their portfolios.’