From 1st July the Council of Mortgage Lenders is integrated into a new trade association, UK Finance. For the time being, all UKF mortgage information will continue to be published on this website, and UKF member-only mortgage information will only be available here.

UK Finance represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation takes on most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association. Please go to www.ukfinance.org.uk for wider content and updates from UK Finance.

  1. Home
  2. News
  3. Press releases
  4. House purchase lending up 22% in June

House purchase lending up 22% in June

Published: 11 August 2015

Lending in June:

  • First-time buyers saw a large month-on-month increase in activity compared to May, but little change when compared to June 2014. 
  • Home mover lending also saw substantial monthly increases and slight yearly increases in volume and value. 
  • Home-owner remortgage activity increased by over a third month-on-month and year-on-year. 
  • Buy-to-let continues to grow year-on-year and month-on-month, mainly driven by buy-to-let remortgage activity. 

Lending in the second quarter 2015:

  • Coming out of the first quarter seasonal dip, First-time buyers increased in number and amount advanced by over 20% but there was a year-on-year decline in lending when compared to the same quarter in 2014.
  • Home mover lending saw similar quarter-on-quarter increase but year-on-year decline.  
  • Home-owner remortgage activity rebounded to higher volume and value compared to the first quarter of the year and the second quarter of 2014.
  • Buy-to-let has increased compared to the second quarter last year in both volume and value. This was mainly driven by remortgage activity.  

Paul Smee, director general of the CML, commented:

Notable this month is the uptick in remortgage activity among home-owners, perhaps reflecting an increased desire to lock into competitively-priced mortgage deals in advance of any rise in rates. It is likely that people are now beginning to feel a rate rise is a realistic prospect,  and not just a distant theoretical possibility.

After a slower than expected start to the year, lending now appears to be picking up as we expected, and in line with our recently revised forecasts.

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

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

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

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

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Download the data

Lending for house purchase and remortgage   

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

  Number of house purchase loans Value of house purchase loans, £m Number of remortgage loans Value of remortgage loans, £m
June-15 61,000 10,600 31,600 5,100
Change compared to May 2015 21.8% 24.7% 30.0% 30.8%
Change compared to June 2014 -1.0% 3.9% 31.1% 34.2%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Table 2: Second quarter lending for home-owner house purchase and remortgage

  Number of house purchase loans Value of house purchase loans, £m Number of remortgage loans Value of remortgage loans, £m
Second quarter 2015 160,100 27,500 82,200 13,200
Change compared to first quarter 2015 21.6% 22.8% 8.6% 10.9%
Change compared to second quarter 2014 -7.7% -4.2% 8.6% 14.8%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

House purchase lending in the UK in June saw a substantial month-on-month increase in activity with over 20% more loans being advanced to purchase a house compared to May. However, the number of loans and value for home-owner house purchase remained relatively steady compared to June last year, with the number of loans decreasing slightly but the amount borrowed increasing. There was a relatively similar trend in activity for home-owner house purchase in the second quarter overall.

The rise in the number of loans for house purchase in June was driven by both first-time buyers and home-movers. The increase in the two areas was broadly the same in value and volume terms.

As previously reported, gross lending in June totalled £20.1bn, up 25% on May and 13% up on June last year. This meant in the second quarter, gross lending came to £52.2bn, up 17% on the previous quarter and a 2% rise on the second quarter 2014.  

Overall in June, the value of home-owner loans for house purchase accounted for 54% of gross lending, while remortgage activity accounted for 25%. Buy-to-let as a proportion of total lending remained at around 17% but still makes up a larger portion of total lending compared to the same time last year.

Table 3: June first-time buyer lending and affordability measures

 

Number of loans

Value of loans £m

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of   income

June-15

28,300

4,200

127,451

39,065

80.1%

3.40

10.0%

18.2%

May-15

22.0%

 23.5%

124,699

38,551

83.3%

3.37

10.2%

18.4%

Jun-14

-2.4%

 No Change

123,750

37,136

80.3%

3.46

11.5%

19.3%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Table 4: Second quarter first-time buyer lending and affordability measures

 

Number of loans

Value of loans £m

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of   income

Second quarter-2015

74,700

11,000

125,400

38,716

81.7%

3.38

10.2%

18.4%

First quarter 2015

21.7%

 22.2%

122,693

38,265

82.5%

3.34

10.9%

18.9%

Second quarter 2014

-7.7%

 -6.0%

122,000

36,764

83.3%

3.46

11.6%

19.4%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Competitive mortgage rates mean first-time buyers are paying a record low proportion of their monthly household income in June to service the capital and interest rate payments of their mortgage. This is the lowest level since the CML began tracking it in 2005.

Table 5: June home mover lending and affordability measures

 

Number of loans

Value of loans £m

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of   income

June -15

 32,700

 

 6,400

 

164,605

54,935

73.2%

3.12

7.7%

17.9%

May - 15

 21.1%

 25.5%

159,608

53,192

73.8%

3.08

7.8%

18.0%

May - 2014

 0.3%

 6.7%

153,750

52,015

72.0%

3.08

8.8%

18.7%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Table 6: Second quarter home mover lending and affordability measures

 

Number of loans

Value of loans £m

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of   income

Second quarter 2015

 85,500

 

 16,400

 

160,994

54,004

73.6%

3.08

7.8%

18.0%

First quarter 2015

 21.4%

 22.0%

158,335

53,800

72.9%

3.03

8.3%

18.3%

Second quarter 2014

 -7.7%

 -3.5%

150,995

51,260

72.5%

3.08

8.8%

18.7%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Home movers spent 17.9% of their monthly gross household income to pay capital and interest repayments, down on last month and the same period last year. Like first-time buyers, this is the lowest it has been since the CML began tracking this data in 2005.

Chart 3: Number of home-owner remortgages

 Chart 3: Number of home-owner remortgages

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Download the data

Remortgage activity showed a sudden sharp rise in activity in June, after a muted beginning of the year, rising in both volume and value by over a third compared to both the previous month and June last year. Second quarter remortgage activity also saw increases compared to the first quarter and the same period last year although the rise was not as sharp. 

Lending for buy-to-let

Buy-to-let lending for house purchase has performed more strongly than the home-owner loans for house purchase for most of the year, which in part is due to buy-to-let lending declining more than home-owner loans during the downturn. It currently accounts for 17% of gross lending in June.

Overall, buy-to-let lending rose sharply in June, increasing both month-on-month and year-on-year. While buy-to-let house purchase rose significantly, these increases are driven more by strong buy-to-let remortgage activity. A similar trend was seen in the second quarter as a whole, although the increases in volume and value were more muted. 

Table 7: June buy-to-let lending 

 

Gross lending

House purchase

Remortgage

 

Number   of loans

Value   of loans (£m)

Number   of loans

Value   of loans (£m)

Number   of loans

Value   of loans (£m)

June-15

22,100

3,400

10,400

1,400

11,500

1,800

Change on May 15

22.8%

25.9%

16.9%

16.7%

29.2%

28.6%

Change on June 14

38.1%

54.5%

23.8%

40.0%

53.3%

63.6%

Source: CML Economics

Table 8: Second quarter buy-to-let lending 

 

Gross lending

House purchase

Remortgage

 

Number   of loans

Value   of loans (£m)

Number   of loans

Value   of loans (£m)

Number   of loans

Value   of loans (£m)

Second quarter 2015

58,000

8,800

28,020

3,810

29,400

4,590

First quarter 2015

10.9%

12.8%

14.6%

16.2%

7.4%

10.6%

Second quarter 2014

25.5%

39.7%

16.4%

30.0%

35.4%

43.4%

Source: CML Economics

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

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

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. Buy-to-let data is sourced from a sample of CML members and has been grossed to estimate the industry total. The CML began collecting monthly data in January 2013 and will from now on report monthly buy-to-let data in this press releases, alongside our home owner house purchase 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 July 2015 data will be released on Tuesday 15 September 2015.

Contact us

Gareth Hill

02074388922

Sue Anderson

0207 4388924

Bernard Clarke

0207 4388 923