You are here: Home - News -

Mortgage lending rose in October despite Brexit uncertainty – UK Finance

by:
  • 26/11/2018
  • 0
Mortgage lending rose in October despite Brexit uncertainty – UK Finance
Gross mortgage lending across the residential market rose by 5.6% in October compared to the same month a year ago, despite continuing uncertainty surrounding Brexit, data showed.

 

Mortgage lending increased to £25.5bn in October 2018 from £24.2bn in the same month last year, according to the latest figures released by UK Finance.

The report showed that the number of mortgages approved by the main high street banks in October fell by 4.1% from October 2017.

Approvals for house purchase were 3.6% higher, standing at 45,289 compared to 43,706 last year.

However, remortgage approvals fell by 13.5% to 33,505 from 38,746 recorded in October 2017, whilst approvals for other secured borrowing were 1.3% lower at 9,619.

Eric Leenders, managing director of Personal Finance at UK Finance, said that remortgaging activity has softened, following a period of strong growth driven by fixed rate loans reaching maturity and anticipation of August’s base rate rise.

He added: “Households are taking a measured approach to credit, with repayments on credit cards broadly in line with spending.

“This reflects the growing preference of customers to use their credit cards as a means of payment rather than a borrowing mechanism, making the most of additional consumer protections and value-added benefits.”

Lender fire sale possible

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Remortgaging dropped away a little but that is no surprise given the surge in activity in this part of the market until now.

“Over the past six weeks, Swap rates have been trending downwards. The question is: will we see a lender fire sale as they target completions before year end as the cost of funding is cheaper? It could be a good time for borrowers to pick up an attractive mortgage deal as lenders compete more aggressively for business.”

Jeff Knight, marketing director for Foundation Home Loans, said there is no denying the increased uncertainty over the last few weeks as Brexit negotiations continue, and this will have an impact on market momentum.

He added: “However, volatility is mitigated by increased choice among lenders, catering to the demands of landlords who require a more specialist approach. BTL  remortgaging is therefore ticking along, and this support of rental property supply is incredibly important given supply remains an issue.”

There are 0 Comment(s)

You may also be interested in