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.

Published: 12 September 2017

UK Finance data shows that lending for house purchases in July was lower than in the preceding month but higher than a year earlier: 

  • First-time buyers borrowed £5 billion, 15% lower than in June but 14% higher than in July 2016.  They took out 30,400 mortgages, down 16% on the preceding month but up 8% year-on-year.
  • Home movers borrowed £7.1 billion, 9% less than in June but 15% more than in July last year.  This equated to 32,800 loans, down 10% on June but up 10% on July 2016.
  • Remortgaging by home owners totalled £6.7 billion, 12% more than in both the preceding month and in July last year.  The number of people remortgaging totalled 36,800, up 7% on June and 10% higher than a year ago.
  • Buy-to-let lending totalled £3.2 billion, 7% higher than in June and 7% higher than in July last year.  This equated to 20,500 mortgages, 5% more than in June and 9% more than in July last year.

Commenting on the data, UK Finance’s Head of Mortgages Policy June Deasy said: 

Remortgaging strengthened in July and reached its highest level since January, with customers attracted by borrowing rates that are at or close to their historic low point. The increase in activity in July means that, over the last year, the number of people remortgaging has been at its highest since 2009.

Lending for house purchase was lower in July than in the preceding month, and we expect the market to continue to soften a little in the coming months.

Home owner house purchase and remortgaging in July 2017

On a seasonally adjusted basis, lending to first-time buyers and home movers declined modestly in value, although the number of loans was unchanged.  The value and number of people remortgaging increased, and there was a smaller increase in both the value and volume of buy-to-let lending.  (The full seasonally and non-seasonally adjusted data can be downloaded at the bottom of the page.)

The proportion of household income taken up by monthly mortgage payments nudged upwards in July for both first-time buyers (17.4%) and movers (17.6%).  But it remained low by historical standards.

The average amount borrowed by a first-time buyer edged up from £138,750 in June to £139,000 in July.  The average first-time buyer household income declined marginally, which means that their average income multiple nudged up from 3.59 to 3.60.

The average amount borrowed by movers was unchanged at £180,000, as was their average income multiple of 3.39.

Chart 1: Number of loans to home owners, 2007-17

20170912 Chart 1: Number of loans to home owners, 2007-17

Source: UK Finance regulated mortgage survey

Buy-to-let lending in July

Remortgaging accounted for more than 70% of all buy-to-let lending in July.  Buy-to-let remortgaging was 10% higher than in June, but overall the sector continued to reflect the more subdued levels of activity seen since the introduction of higher stamp duty in the spring of 2016.

Chart 2: Number of loans for buy-to-let

20170912 Chart 2: Number of loans for buy-to-let

Source: UK Finance Economics (pre-2013 data based on quarterly data)

Table 1: Number of loans for house purchase and remortgage 

  House purchase Remortgage
  FTBs Movers Buy-to-let Home owners Buy-to-let
July 2016 28,100 29,800 6,100 33,500 12,400
June 2017 36,100 36,400 6,600 34,400 12,500
July 2017 30,400 32,800 6,400 36,800 13,700
1 month change -15.8% -9.9% -3.0% 7.0% 9.6%
12 month change 8.2% 10.1% 4.9% 9.9% 10.5%

 

Table 2: Value of loans for house purchase and remortgage

  House purchase Remortgage
  FTBs Movers Buy-to-let Home owners Buy-to-let
July 2016 4,400 6,200 900 6,000 2,100
June 2017 5,900 7,800 900 6,000 2,000
July 2017 5,000 7,100 900 6,700  2,200
1 month change -15.3% -9.0% 0.0% 11.7% 10.0%
12 month change 13.6% 14.5% 0.0% 11.7% 

 4.8%

 

Table 3: First-time buyer affordability measures

 

Loan

size (£)

Income (£)

Loan-to-

value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of income
July 2016 133,200 40,248 85.0% 3.55 9.3% 18.1%
June 2017 138,750 41,000 83.3% 3.59 8.1% 17.3%
July 2017  139,000 40,974 85.0% 3.60 8.2% 17.4%

 

Table 4: Home mover affordability measures

 

Loan

size (£)

Income

(£)

Loan-to-

value

Loan-to-

income

Interest

payment

as % of

income

Capital and interest payment as % of income

July 2016 172,000 55,028 71.5% 3.28 7.4% 18.0%
June 2017 180,000 55,267 73.1% 3.39 6.5% 17.5%
July 2017  180,000 55,604 72.3% 3.39 6.5% 17.6%

 

Affordability infographics

 

 Infographic of first-time buyers July data

 

 

 Info graphic for home movers July 2017

 

 

 

Notes to editors

  1. UK Finance is a new trade association which was formed on 1 July 2017 to represent the finance and banking industry operating in the UK. It represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation brings together 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.

  2. Mortgage lending figures for July will be released on Thursday 12 October 2017.

Contact us

Bernard Clarke

020 3934 1166