Remortgaging drives growth in mortgage lending, data reveals
New data from UK Finance has revealed that, year-on-year, gross mortgage lending rose by four per cent to hit £61.4 billion in the first quarter (Q1) of 2018, with growth driven predominantly by remortgaging.
Quarter-on-quarter, however, figures reveal that new mortgage approvals for the first three months of the year were actually down by 14 per cent, having fallen from 116,275 to 100,559.
Remortgaging remained popular throughout the period, up one per cent, helping to keep the market steady.
According to the report, there was a slump in homebuying activity throughout March, with just £20.5 billion worth of new mortgages approved – a 2.3 per cent year-on-year decrease for the month. This temporary slump had a negative impact on the figures for the quarter as a whole.
Commentators have said that the news is not unexpected in light of recent data published by the Royal Institution of Chartered Surveyors (RICS) which echoed a similar sentiment.
Alan Collett, a Fund Manager at Hearthstone Investments, said that the strong activity throughout January and February and the “rising trend in mortgage approvals” across the first three months of the year in general was “positive news,” indicating “a stable, ongoing market with opportunities for buyers.”
Meanwhile, Richard Pike, Sales Director at Phoebus Software, said: “It’s easy to look at the figures month by month and see that lending is down on the same month last year.
“However, when you compare the first quarter of 2018 to 2017 lending is actually up four per cent.”