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Buy-to-let lending up 36% year-on-year in October

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  • 15/12/2015
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Buy-to-let lending up 36% year-on-year in October
Gross buy-to-let lending increased by 36% year-on-year in October to reach £3.8bn, statistics from the Council of Mortgage Lenders (CML) show. 

Compared to the previous month, buy-to-let lending rose by 3% from £3.7bn. Overall, buy-to-let lenders advanced 24,800 mortgages, compared to 23,900 in September and 19,400 in October 2014.

The CML said that this was the highest monthly gross buy-to-let lending level by value and by volume since it had began tracking buy-to-let data on a monthly basis which began in January 2013.

By transaction type, buy-to-let remortgaging outstripped house purchasing activity in value and volume. The number of remortgages advanced in October was 13,300 valued at £2.2bn. This represents a 39% rise in volume and a 47% increase in value year-on-year. The value of buy-to-let house purchase lending in October reached £1.6bn, a 33% increase year-on-year while transaction levels jumped 18% year-on-year from 9,700 loans to 11,400.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Landlords may be disgruntled by the double whammy of tax changes and the impending hike on Stamp Duty but they can’t complain about some of the cheapest buy-to-let rates ever. However, lenders are beginning to impose tighter criteria on buy-to-let mortgages when it comes to stress-testing and others are expected to follow, making it harder to qualify for higher loan-to-value mortgages, particularly in the south where yields are low.”

Residential lending

Remortgage lending saw the greatest year-on-year increases out of the three categories of lending types.

Homeowner remortgage lending compared to October 2014 increased by 19% from 27,000 loans to 32,100 and 34% in value from £4.1bn to £5.5bn.

First-time buyers borrowed £4.6bn for homeowner house purchase, up 10% on October last year which totalled 29,900 loans, a rise of 3% year-on-year.

Home movers took out 35,400 loans, an increase of 3% compared to October 2014 which held a value of £7.1bn; 13% higher than the value of homemover mortgages in the same month of previous year.

UK gross lending overall in October totalled £21.9bn, up 9% on September and 19% on October last year. This is the highest monthly gross lending figure since July 2008.

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