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Remortgaging continues to outstrip purchase lending

  • 05/06/2003
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Lending for house purchase is on the rise again. While remortgaging remains the market driver, loans...

Lending for house purchase is on the rise again. While remortgaging remains the market driver, loans for house purchase also showed modest rises in April, according to the Council of Mortgage Lenders (CML). Loans for house buying amounted to £8.4bn in April, up £0.2bn on the previous month. However, this is still 9% lower than in April last year.

The CML’s monthly mortgage lending figures show gross lending up from £19.7bn in March to £21bn in April, a 28% increase on the same period last year. Remortgaging rates, however, remain high. 51% of this figure was accounted for by remortgaging activity, which at £10.7bn is 70% up on the same time last year.

Commenting on the figures, Sue Anderson, head of external affairs at the CML, said: ‘The way we see it is, looking ahead, there will continue to be strong lending, driven mainly by remortgaging. A slowdown from the past year is pretty much inevitable, but a slowdown to something that looks worrying is far from inevitable. Despite some of the more hyped media coverage, it does not seem to be what the estate agent’s and surveyor’s surveys are seeing either. Although growth will slow there will, broadly speaking, still be growth.’

There was a small recovery in the number of loans to first-time buyers compared with the previous month ‘ around 33,000 compared with fewer than 31,000 in March. This is still down on April last year’s 39,000. First-time buyers accounted for 34% of all loans for house purchase last month. Fixed-rate mortgages remained most popular, accounting for 44% of all new lending.


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