Remortgage sector stands firm despite mortgage lending decline

6th June 2016

New Bank of England figures show that UK mortgage lending dropped significantly in April following the recent 3% increase in stamp duty on buy-to-let properties and second homes.

The bank’s Money and Credit report revealed that mortgage lending increased by just £281 million in April, far below economists’ forecasts.

The number of mortgage approvals dropped from 70,305 in March to 66,250 in April. However, remortgage approvals totalled 40,510, relatively flat with the previous six-month average.

Richard Sexton, director at chartered surveyor e.surv, said: “This natural slowdown follows the flurry in buy-to-let activity following April’s stamp duty deadline, but June’s referendum could also be causing temporary caution.

“Remortgaging remains strong, however, with lenders offering a variety of new and increasingly flexible mortgage rates for existing homeowners. And it’s not just the remortgaging sector with a spring in its step. Overall house purchase approvals may be down, but first-time buyers are still very much in the game.”

*2 year fixed with TSB 1.09% then 3.59% - APRC is 3.3% Max LTV is 60%. Quoted on 27th May 2020.