This is 8% higher than March’s gross lending total and 36% higher than April last year (£12.2 billion) and the highest total for an April since 2008 (£25.7 billion).
Commenting on market conditions in this month’s Market Commentary, CML chief economist Bob Pannell observes:
"The implementation of the Mortgage Market Review from late April has made it a little harder to interpret recent data. As we have pointed out previously, there may be some disruption to the monthly pattern of activity while MMR procedures bed down.
"The Bank of England has signalled that macro-prudential measures to limit the housing market upturn are likely in the near future, and possibly in the very near future.
"Forthcoming measures will, in our estimation, be careful, calibrated, and proportionate, and designed to reinforce prudent affordability checks, rather than to apply the brakes to the housing market in a more dramatic fashion."
Mark Harris, chief executive of mortgage broker SPF Private Clients, says:
"The lending market continues to strengthen as the combination of cheap finance and lenders with a real appetite to lend shows no signs of diminishing. However, fears are growing that Mark Carney's comments about the need to cool parts of the housing market will impact the ability of some borrowers to get a mortgage.
"The move by Lloyds is slightly puzzling. It won't have a significant impact on Lloyds' lending book as the bank itself expects the change to impact around 8 per cent of its lending in London. There are other choices for borrowers requiring mortgages at this level and we don't expect other lenders to follow suit as it doesn't make a great deal of sense. If you are earning in the region of £125,000, which would qualify you for a £500,000 loan, you are the sort of person who can cope with an increase in interest rates as you will have greater disposable income than a first-time buyer.
"While a first-time buyer is likely to plough every last penny of savings into a property purchase, on larger loans borrowers often don't need to borrow at quite that level. They tend to have plenty of fall-back cover, such as lots of liquid cash in savings and ISA portfolios that they can dip into in the event of changing circumstances or an interest rate rise. They are much more capable of dealing with a change in situation.
"Lloyds would not necessarily be the first choice for borrowers requiring £500,000-plus loans anyway and there is plenty of capacity elsewhere in the market to take up the slack."
Henry Woodcock, Principle Mortgage Consultant, IRESS, comments:
“Today’s figures highlight the underlying strength of the mortgage market, but they must be taken with a pinch of salt. The full effects of MMR won’t be felt in the monthly numbers until the end of May at the earliest. In fact, in the run-up to April 26th, there was a concerted rush to secure and complete mortgage applications ahead of the changing regulation, accentuating the activity in the market.”
“The mortgage application process is lengthening, and in the short-term at least, this will likely dampen lending. However, that’s not to say it will derail the progress we have seen in the last year. Availability is improving, and it’s clear that the combination of Help to Buy and record low interest rates have supported the first-time buyer market. Together with a thriving buy-to-let sector, the fundamentals are in place for gross lending to continue its climb in the long-term.”
