Gross Mortgage Lending Hits £22.1bn in June, Estimates UK Finance
Gross mortgage lending hit £22.1 billion in June, according to the latest estimate from UK Finance.
This figure is 9% higher than May’s lending total of £20.3 billion and up by 3% on the £21.5 billion lent in June 2016.
Gross mortgage lending for the second quarter (Q2) of 2017 was therefore an estimated £60.3 billion. This is a 3% increase on Q1 and up by 6% on the £57.1 billion lent in Q2 2016.
Mohammad Jamei, the Senior Economist at UK Finance, comments on market conditions: “A period of belt-tightening now seems to be underway, as inflation begins to erode consumer spending power and consumer confidence weakens. Given that the economy and housing market are closely linked, this has contributed to the activity plateau since the start of the year.
“Looking ahead, housing market activity is likely to reflect economic conditions; a deterioration would likely dampen first time buyer numbers and homeowners remortgaging – the factors that have supported lending recently.”
The Director of chartered surveyor e.surv, Richard Sexton, also responds to the latest figures: “It’s positive that lending to first time buyers has continued to increase throughout 2017. We’re seeing similar trends in our Mortgage Monitor data and believe this is largely due to record low mortgage rates on offer, as well as the increased support of Government and lender schemes helping to get more buyers onto the ladder.
“The rise in remortgaging and first time buyer activity is a great step in the right direction, however, it is clear there is not enough movement in the mid-market. This is causing a bottleneck of housing supply and, in turn, is pushing up prices to historical highs. Confidence in the market and more favourable economic conditions should bring more fluidity to the market. As more existing homeowners climb the property ladder, they will eventually free up affordable property for those looking to get onto the first rung.”
The latest Council of Mortgage Lenders (CML) data, released through UK Finance, shows that mortgage lending was up for all borrowers in May.