Lending to home-buyers decreased month-on-month in November totalling 55,600 loans. This was down 12% compared to October with the value of these loans totalling £9.2bn, a fall of 13%. Compared to November 2013, the number of loans decreased by 7% and the value of lending by 1%.
Remortgage lending activity also saw a decline month-on-month in November, with the number of remortgage loans totalling 24,000. This was 8% down on October and 16% down on November last year. The value of these loans (£3.6 billion) was down 10% on the previous month and down 14% on November last year.
Paul Smee, director general of the CML, commented:
“The easing back of activity is not completely unexpected as there is usually a seasonal lending dip in the winter months and the major industry changes and more restrained market sentiment have inevitably caused month-to-month fluctuations over the last twelve months. Our forecasts are for gross lending to continue to grow over the next two years and this reflects our belief that there are more stable conditions in the market than a year ago.
Paul Hunt, Phoebus Software managing director, said:
“Today’s CML figures showing a 12% drop in the amount of lending for purchases as well as a dip in remortgages and first time buyers shows that we have definitely experienced a shift in the market. Last year is very much proving to be a year of two halves with a buoyant first half and a slightly more sober second half to the year.
"I expect this year to be the reverse of that with a more subdued first half of the year, especially in the build up to the general election and then a more positive second half to the year. The only part of the market bucking the trend is buy-to-let, as professional landlords look like they are capitalising on the lack of competition amongst residential purchasers.
“Housing demand is high and with falling inflation looking like keeping interest rates at their current levels into 2016, the overall outlook must be very positive for the Sector.”
