September Mortgage Lending Trounces 2018 But Falls Month On Month
The UK mortgage sector enjoyed huge approval and lending increases when compared with 2018, but floundered when compared with stronger summer lending levels.
Remortgage approvals by high street banks increased by almost a quarter in September when compared with the same month in 2018 making the property market seem resilient in the face of difficult political conditions.
Gross mortgage lending for residential property tipped the scale at £22.9 billion in September 2019, 3.7% higher than the figures from September 2018 according to UK Finance.
Similarly, high street banks approved 43,276 residential mortgages in September representing an increase of 13.5% when compared with the same time in 2018.
The 85,880 remortgages approved by high street banks last month towered over September 2018’s total by 23.4% and approvals for other secured borrowing increased by 8.5%.
However, looks can be deceiving and UK Finance ushered a cautious warning, reminding the property sector that September 2018 was extremely subdued, inflating the present statistics and potentially disguising a fall in lending.
Indeed, month on month, September’s gross mortgage lending has actually fallen by £1.1 billion from the £24 billion recorded in August. This represented a decline of over 37%.
Total mortgage approvals also slipped marginally from the 85,931 mortgages approved in August.
Andrew Montlake, Managing Director of the mortgage broker, Coreco, said:
“Brexit, what Brexit? This latest data is yet more evidence that the mortgage and property markets are in relatively good health despite the chaotic political environment.”
“Remortgages are thriving as people look to lock into the lowest rates possible to weather the potential economic storm ahead.”
Jeremy Leaf, North London estate agent and former RICS Residential Chairman, said:
“At first glance these figures look remarkably good considering present Brexit shenanigans, even though they do reflect what was happening in the market a few months previously.
“But when you look more closely it is clear that the market was particularly flat this time last year, which is giving an unrealistic shine to this September’s numbers.
“Nevertheless, they demonstrate that buyers and sellers are carrying on regardless albeit at more realistic price levels. Otherwise deals are simply are not happening.”
Do these statistics suggest an improving market or have subdued conditions in 2018 helped to disguise a slight decline?