The level of first-time borrowing for house purchase was up on both month-on-month and year-on-year comparisons in August, the latest UK Finance figures show.
First time buyers borrowed £5.7bn in August, on a seasonally adjusted basis, 16% more than in July and 12% more than in August 2016. They took out 34,400 mortgages, 14% up on the preceding month and nine per cent more year-on-year.
Home movers borrowed £8.4bn, 18% more than in July and 20% more than in August last year. This equated to 38,500 loans, up 17% on July and 13% on August 2016.
Meanwhile, re-mortgaging by home owners fell in August, totalling £6.4bn, 4% less than in July but 8% more than in August 2016. The number of people re-mortgaging totalled 36,700, down 1% on July but 5% higher than a year ago.
In light of the many changes to the buy-to-let space, fell 3% between July and August but was on a par with August last year. This equated to 20,400 mortgages, the same as in July but 4% more than in August last year.
UK Finance head of mortgages policy June Deasy says: “Activity picked up in August, and recent resilience ensured that borrowing by home movers was at its highest since March 2016, when transactions were boosted by an imminent increase in stamp duty.
“Over the last 12 months, the number of people re-mortgaging has been higher than in any period since late 2009. With mortgage rates close to historic lows and the likelihood of a rise in official rates moving closer, the popularity of re-mortgaging looks set to continue.”
Enterprise Finance Managing Director Harry Landy says: “Buy-to-let and re-mortgage lending activity has seen a fourth consecutive month of growth, which demonstrates borrower confidence in the market. That these positive figures come during a traditionally a quieter month for activity is particularly surprising. However, this month also sees PRA-enforced change in standards of Buy-to-Let mortgage applications has many in the industry concerned about the future prosperity of the market, so we’d sound a note of caution to those getting carried with August’s figures.”