Home buyer mortgage lending rose in volume by 12% in May compared to April and by 10% year-on-year, equating to 58,400 loans, according to new figures.
New figures from UK Finance show that, on a non-seasonally adjusted basis, home buyer mortgage lending reached £10.8bn in May, up 10% on April and 16% on May 2016.
Of this, first-time buyers borrowed £4.7bn, a monthly and yearly increase of 12%. This represented 29,200 loans, up 13% month-on-month and 8% year-on-year.
Meanwhile, home mover mortgage lending came to £6.2bn, up 11% on April and 22% year-on-year. Home movers took out 29,200 loans, also up 11% month-on-month and a rise of 13% year-on-year.
There was also a rise in home owner remortgage activity. Lending to this sector was up in value by 10% month-on-month and by 12% compared to last year. Similarly, remortgage lending was up in volume by 9% on April and by 7% year-on-year.
Paul Smee, Head of Mortgages at UK Finance, said: “The apparent strong growth in mortgage lending in May might flatter to deceive. The relative weakness in lending last May following the stamp duty changes makes comparisons misleading. The seasonally adjusted data shows a less buoyant lending picture, with home buying activity remaining relatively unchanged month-on-month and remortgage lending gradually decreasing each month since January.”
On a seasonally adjusted basis, home movers borrowed £6.3bn in May, down month-on-month by 10% but up 15% year-on-year. Home movers took out 29,100 loans, a drop of 5% on April’s figures, but an increase of 7% on last year.
First-time buyers took out 29,200 loans in May, down 3% on April but up 2% on May 2016. This equated to a lending total of £5bn, down 4% month-on-month, but up 9% on a yearly basis.
As for remortgage activity, £5.9bn was lent to home owners, a 3% fall on April’s figures, but a 7% rise on last year.
“In the summer months, we expect home buying activity to continue with an even split between first-time buyers and home movers but in greater numbers than in the winter months.” added Smee.
ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
You may also be interested in:
Mortgage lenders' income requirements for the self-employed >
Stamp Duty FAQs >
Popular mortgage myths dispelled >