UK gross lending overall in November totalled £20.5bn, down 6% on October but up year-on-year by 27% compared to November 2014. This was the highest lending level in the month of November since 2007.
First-time buyers borrowed £4.2bn, also down on October (-9%) but up 14% on November last year. Competitive mortgage rates mean first-time buyers continue to pay low levels of their monthly household income to service the capital and interest rate payments of their mortgage at 18.3% in November, joint lowest since the CML began tracking this in 2005.
Home movers borrowed £6.5bn in November, this was down compared to October but was the highest November-level since 2007.
Remortgage activity was down 9% by volume and 14% by value compared to October. However compared to November 2014, remortgage lending was up 24% by volume and up 36% by value.
Gross buy-to-let lending decreased in November compared to October but was substantially up on last year. Buy-to-let remortgage continues to be the driver of activity remaining consistent with October and considerable up on the year before.
Paul Smee, director general of the CML, commented:
As expected, mortgage lending activity eased back as the normal dip in the winter months began. There was still growth across all lending types in November compared to the year earlier suggesting continued improvement. Our forecasts anticipate that gross lending will continue a slow but steady upward trajectory over the next two years.
Mark Harris, chief executive of mortgage broker SPF Private Clients, commented:
"While lending slowed in November, compared with a buoyant October, volumes were still higher than a year ago, reinforcing the impression of a robust market.
"The number of first-time buyers continues to grow year-on-year, as they take advantage of the plethora of high loan-to-value deals available. However, a fall in pricing means that first-time buyers are not overstretching themselves as they are paying close to a record low proportion of their monthly household income to service their mortgages.
"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. Many landlords are taking advantage of low rates and the removal of tax breaks with remortgaging accounting for the majority of activity in the sector. However, lenders are imposing 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."
Steve Griffiths, Head of Sales and Distribution at Kensington, added:
“November was a strong month in the mortgage market with year-on-year growth across the board. The low-rate environment drove more first-time-buyers to the market and many existing homeowners also benefitted from favourable market conditions by remortgaging to a low fixed-rate product. Remortgage lending rose significantly over the course of the year and we expect this to increase further in the coming months as the argument for increasing the base rate continues to gain traction.
“It is also important to judge the health of the market by the range of people who have been able to secure a mortgage. For many, real life doesn't fit a standard mortgage application due to the nature of their income or credit history. Those who are self-employed or contractors, for example, should not be excluded from the mortgage market simply for having a more complex application which may require individual assessment. People’s access to the mortgage market should be based on their ability to repay a mortgage and it is therefore crucial that the specialist lending sector continues to grow in line with the wider market."
