UK mortgage borrowing soared in April with £4.4bn in new lending
Mortgage lending in the UK increased considerably in April, according to a report published this morning by trade association UK Finance.
UK Finance’s mortgage trends report revealed that there were 26,700 new first-time buyer mortgages completed in the month, some 3.5 per cent more than in the same month a year earlier.
The £4.4bn of new lending was 4.8 per cent more year-on-year, the data showed.
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Remortgaging in April also increased, with new homeowner mortgages up 36 per cent and buy-to-let remortgages up 32.4 per cent compared to the same month a year earlier.
However, mortgages for people wanting to purchase a second home, so-called home movers, were down some 4.2 per cent compared to the same month a year earlier.
The £5.4bn of new lending to this sector was 3.6 per cent down year-on-year.
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There were 40,800 new homeowner remortgages completed in the April, some 36 per cent more than in the same month a year earlier.
The £7.5bn of remortgaging in the month was 44.2 per cent more year-on-year.
Jackie Bennett, director of mortgages at UK Finance, said: “Remortgaging activity bounced back to strong levels in April, as both homeowners and landlords put their house in order by locking into attractive fixed-rate deals ahead of an anticipated interest rate rise.
“This spike in remortgaging was also driven by a large number of short-term mortgage deal rates coming to an end, combined with increased efforts by lenders to contact their customers before their deal rate expires.”
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Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Remortgaging is where it’s at with owner-occupiers and landlords taking advantage of competitively-priced mortgage deals.
“With the challenger banks eager to carve out market share, and the big lenders realising they need to offer attractive deals in order to compete, it is good news for borrowers.
“The threat of an interest rate rise may have provided the impetus for many to remortgage but it is looking increasingly unlikely that there will be a rate rise anytime soon.
“With wage growth slowing in the three months to April, despite the fall in unemployment, the chance of a near-term increase in interest rates has been reduced.”