Residential mortgage lending up year-on-year by 9pc in fourth quarter

The latest data from the Council of Mortgage Lenders (CML) reveals that while no specific pattern emerged across lending in November and December last year, on an annual basis the value of lending grew across all types, with home-owner house purchase lending up year-on-year by 9% in the fourth quarter.

In December 2015, first-time buyers borrowed £4.5bn for home-owner house purchase, up 7% on November and 18% on December last year.

This totalled 29,300 loans, up 6% month-on-month and 11% year-on-year, as first-time buyer lending was reported to have been given a boost by schemes, such as Help to Buy.

Home movers, meanwhile, borrowed £6.6bn in December, up 2% on November and 20% year-on-year.

This amounted to 33,400 loans, up 3% month-on-month and 12% compared to December 2014.

Home-owner remortgage activity in December, however, was down 16% by volume and 16% by value compared to November.

Compared to December 2014, remortgage lending was up 14% by volume and up 24% by value.

In the fourth quarter 2015, first-time buyers took out 87,100 loans to purchase homes, totalling £13.3bn.

This is an increase in volume of 3% on the third quarter and 14% on the fourth quarter 2014. By value the figure was up 3% quarter-on-quarter and 8% year-on-year.

Home movers took out 101,900 loans in the same period, down 1% quarter-on-quarter but up 9% compared to the fourth quarter 2014.

The total value of £20.3bn was down 3% on the third quarter but up 18% year-on-year.

Meanwhile, home-owner remortgage activity in the fourth quarter 2015 was up 4% by volume and 6% by value compared to the third quarter.

Compared to the fourth quarter 2014, remortgage lending was up 21% by volume and up 35% by value.

Overall in 2015, first-time buyers and home movers saw their highest lending figures since 2007.

First-time buyers borrowed £46.7bn for home-owner house purchase in 2015, up 4% on 2014. This totaled 311,700 loans, unchanged from the previous year.

Home movers took out 365,800 loans in 2015, down 0.2% on 2014, but the amount borrowed totalled £72.1bn and was up 7% on 2014.

Lastly, home-owner remortgage activity in 2015 was up 11% by volume and 20% by value compared to 2014. The value of remortgage lending was also at its highest since 2008.

Paul Smee, director general, Council of Mortgage Lenders, said:

“Improving economic conditions, boosted by government schemes like Help to Buy, saw the highest quarterly number of loans to purchase a home for eight years. The market has seen a gradual upward trajectory over the past few years, rather than rapid growth, and we'd expect this trend to continue with gross lending steadily increasing over the next two years.”