The figures show that according to the Bank of England, the total gross lending in June grew by 6 per cent on month, but 20 per cent more than the same time
last year, to £17.9 billion. In the quarter, gross lending totalled £51.4 billion – up 11 per cent on the first quarter and 23 per cent on the second quarter of the year.
The data on the lending trends in June also showed that a value of £4.2 billion was given in 28,600 loans to first time buyers. Up 27 per cent compared to June 2013. The amount lent to home movers also increased, but not as sharply, with the amount lent totalling £5.9 billion – a 23 per cent increase on June last year.
Paul Smee, Director General of the CML, commented: “For the second month running since new FCA rules took effect, lending characteristics remain similar to the market beforehand. We now feel confident that, as we would hope, the MMR effect is more gentle dampener than hard brake. As we recently suggested in our revised forecasts, lending levels should continue to increase modestly over the course of the year, driven mostly by house purchase but with remortgaging also recovering.”
The June results also saw the buy to let market grow by 5 per through the month to a value of £2.2 billion, though the total number of loans was the same as May at 15,600. Compared to the same period last year, the number of buy to let loans were up by 23 per cent, and up 38 per cent in value.
Remortgage lending remained muted compared with the other results. The number of remortgages in June was up by 1 per cent on May but down by 8 per cent compared to June 2013, however the value of £3.7 billion was up 6 per cent on May this year and June last year.
Lucy Hodge, Director at Vantage Finance commented on the results: “The continued strength of buy-to-let lending shows the popularity of rental accommodation hasn’t waned among property investors or tenants. While the residential mortgage market is experiencing the challenges of the lending restrictions associated with the MMR and borrowing limits being capped, the BTL market has not been directly affected and has seen continued growth.
“The availability of funding and lender choice continues to be broad. Rising house prices across the country mean there’s a large pool of people priced out of the market looking to rent, especially in London. This, combined with still-low interest rates, means we have the ideal conditions for property professionals to expand their portfolios.”
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