Number of Loans for house purchase drops from March to April – BoE

The number of loans for house purchase taken out in April was 71,849 according to the Bank of England, a drop of just over 5,000 from the previous month.

However the number of loans taken out was still marginally higher than April last year, when 69,836 loans for house purchase were taken out.

The change from March to April is further evidence of the effect of treasury policy, the change in stamp duty for second homes being the most significant change compared with last year, when the number of loans in March and April were broadly the same.

As well as those loans taken out for purchase, there were also 42,260 remortgages, a drop from 44,521 the previous month. However Richard Sexton, Chartered Surveyor with e.surv sees the EU referendum playing a further role in cooling the market.

Richard said: “After an extraordinary lift earlier this year, April saw house purchase approvals drop slightly as activity in the lending market settled down. 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.

“An increase in available mortgage deals is playing into the hands of first-timers too, providing further choices and even inter-generational solutions. House prices continue to increase, but financial factors – particularly low inflation and rising wages – are helping first timers step onto the property ladder. Both factors have helped savings and with government schemes such as the Lifetime ISA leading the way, there’s nothing to suggest first-time buyer lending won’t go from strength-to-strength as we approach the second half of the year.”

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