Gross residential mortgage lending fell 1.1 per cent to £265.8bn in 2019 compared to £267.5bn in 2018. Of this, 65 per cent, or £172.1bn, was loaned by high street banks.
The total does not include product transfers, which according to the latest data, totalled £43bn Q3 2019 alone. In 2018 product transfers were worth £158bn.
UK Finance said despite the fall in lending during the past year, “the last two years have broadly reflected the continuation of a stronger long-term lending trend over recent years.”
In December, UK Finance said it expected 2019’s lending figure to come in at around £264bn but the final figure has proved slightly higher than this.
High street lenders growing further
Meanwhile, high street mortgage approvals rose 7.4 per cent to 982,286 in 2019 against 2018.
The approvals comprised 507,789 for home purchases, 367,590 for remortgages and for other loans, 106,907.
Home purchases grew by eight per cent, remortgage approvals rose 7.9 per cent and other secured loans were up three per cent on the previous year.
“The increase in number of approvals in 2019, against the fall in value, shows quite clearly the effect the weak market in London and the South East had over the year,” said Richard Pike, sales and marketing director at Phoebus Software.
“When you consider the number of high value properties in that area, it’s easy to see the effect a decline in sales has on the value of mortgages approved.”
Strong activity in December
For the month of December, gross lending grew 6.5 per cent to £22.2bn compared to the same month in 2018. The high street’s share, £15.2bn, or 68 per cent, rose by 21.9 per cent compared to December 2018.
High street approvals totalled 66,390 in December 2019. Home purchase approvals were up 24.1 per cent to 32,451, remortgages rose 30.6 per cent to 26,979 and other loans were up 23.5 per cent to 6,960, compared to December 2018.
Pike added: “We saw a rise in first-time buyer activity throughout the year. And the fact that home purchase numbers increased, and by a not insignificant amount, demonstrates that not everyone was waiting for certainty last year.
“As we head into a more stable environment politically it will be interesting to see how the market fairs.”
Vikki Jefferies, proposition director at Primis, added: “Today’s figures indicate that remortgaging continues to be an attractive option for borrowers, and advisers can capitalise on this to ensure that more of their clients take advantage of the low rates available.”