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House purchase lending up 8% in October

Published: 15 December 2015

Lending in October:

  • First-time buyers borrowed £4.6bn for home-owner house purchase, up 10% on September and October last year. This totalled 29,900 loans, up 8% month-on-month and 3% year-on-year. 
  • Home movers took out 35,400 loans, up 9% month-on-month and 3% compared to October 2014. In total, this was £7.1bn borrowed, up 8% on September and 13% year-on-year. 
  • Home-owner remortgage activity also increased, up 6% by volume and 10% by value compared to September. Compared to October 2014, remortgage lending was up 19% by volume and 34% by value. 
  • Gross buy-to-let saw month-on-month increases up 4% by volume and 3% by value, but more substantial growth year-on-year.    

Paul Smee, director general of the CML, commented:

Home owner and buy-to-let activity have both continued the upward trend seen last month, and the market looks set to finish the year strong, despite taking time to gain momentum after a slow start to 2015. With increasing employment and the current absence of inflationary pressures in the UK, conditions for continuing demand in the housing market seem likely going into the new year. How supply will respond to this challenge going forward is a crucial question for 2016.

Chart 1: Loans to home-owners and for buy-to-let by value

20151215 October 2015 MLT press release chart 1

Source: CML Regulated Mortgage Survey (April 2005 onwards), CML Economics 

Download the data

Chart 2: Number of loans for house purchase and proportion of FTBs and home-movers

 20151215 October MLT 2015 - Chart 2

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Download the data

Lending for house purchase and remortgage   

Table 1: October lending for home-owner house purchase and remortgage

  No. of house purchase loans % change by volume Value of house purchase loans, £m % change by value No. of remortgage loans  % change by volume Value of remortgage loans, £m % change by value
Oct-15 65,300   11,600   32,100   5,500  
Sept-15 60,200 +8.5% 10,800 +7.4% 30,400 +5.6% 5,000 +10.0%
Oct -14 63,200 +3.3% 10,500 +10.5% 27,000 +18.9% 4,100 +34.1%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

House purchase lending in the UK in October saw an increase by volume and by value of mortgages advanced compared to September and October last year. This was the second highest monthly house purchase levels, after July 2015, since 2007. 

As previously reported, UK gross lending overall in October totalled £21.9bn, up 9% on September and 19% on October last year. This is the highest monthly gross lending figure since July 2008.

Table 2: October first-time buyer lending and affordability measures

 

No. of loans

% change by volume

Value of loans £m

% change by value

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital & interest payment as % of income

Oct-15

29,900

 

4,600

 

128,060

38,571

83.7%

3.47

9.8%

18.4%

Sept-15

27,600

+8.3%

4,200

+9.5%

128,000

39,328

82.2%

3.45

9.7%

18.3%

Oct-14

28,900

+3.5%

4,200

+9.5%

124,200

38,235

83.7%

3.38

11.9%

19.4%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

First-time buyer lending grew for the second month in a row, to be the joint highest monthly lending level (alongside July 2015) by volume and by value since August 2007. Competitive mortgage rates mean first-time buyers continue to pay low levels of their monthly household income to service the capital and interest rate payments of their mortgage at 18.4% in October. 

Table 3: October home mover lending and affordability measures

 

No. of loans

% change by volume

Value of loans £m

% change by value

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital & interest payment as % of income

Oct-15

35,400

  7,100  

165,295

54,220

72.4%

3.17

7.6%

18.2%

Sept-15

32,600

+8.6%

6,600

+7.6%

167,888

55,002

72.3%

3.17

7.5%

18.1%

Oct-14

34,300

+3.2%

6,300

+12.7%

152,500

53,100

71.1%

3.01

9.0%

18.5%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Home movers borrowed £7.1bn in October, only behind July this year for the highest amount borrowed since 2007. Home movers spent 18.2% of their monthly gross household income to pay capital and interest repayments, slightly more than last month but a decrease compared to September 2014.

 Chart 3: Number of home-owner remortgages

 20151215 October MLT 2015 - Chart 3

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Download the data

Remortgage activity saw a rise by volume and by value in October compared to September and October last year. This is the most amount of remortgage loans in a month since January 2009, and the most amount borrowed for remortgage since June 2008.

Lending for buy-to-let 

Gross buy-to-let lending increased substantially in October, up by volume and by value in comparison to the previous month and the same time last year. This is the highest monthly gross buy-to-let lending level by value and by volume since we began tracking buy-to-let data on a monthly basis in January 2013. Buy-to-let remortgage is currently driving this with larger year-on-year growth compared to October 2014. 

Table 4: October buy-to-let lending 

 

Gross lending buy-to-let

Buy-to-let house purchase

Buy-to-let remortgage

 

No. of loans

 % change

Value   of loans (£m)

% change

No. of loans

% change

Value   of loans (£m)

% change

No. of loans

% change

Value   of loans (£m)

% change

Oct-15

24,800

  3,800

 

11,400

 

1,600

 

13,300

 

2,200

 

Sep-15

23,900

+3.8%  3,700

+2.7%

11,200

+1.8%

1,500

+6.7%

12,600

+5.6%

2,100

+4.8% 

Oct-14

19,400

+27.8% 2,800 

+35.7%

9,700

+17.5%

1,200

+33.3%

9,600

+38.5%

1,500

+46.7%

Source: CML Economics

Chart 4: Number of buy-to-let loans for house purchase and remortgage 

 20151215 October MLT 2015 - Chart 4

Source: CML Economics

Download the data

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 95% of all residential mortgage lending in the UK. There are 11.1 million mortgages in the UK, with loans worth over £1.3 trillion.

2. Source: CML Regulated Mortgage Survey for all home-owner mortgage data.

3. The Council of Mortgage Lenders does not publish statistics for mortgage approvals. The data in our monthly Regulated Mortgage Survey and gross lending press releases relate to mortgage advances only. A mortgage approval is the firm offer to a customer of a specific amount of credit secured against a particular property. A mortgage advance is the total amount of loan actually provided to the buyer, by the lender. Please see the mortgage statistics timeline on our website for further information.

4. The November 2015 data will be released on Thursday 14 January 2015.

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