Residential and Buy to let lending surges year on year

mortgage-propertyLending to both residential buyers and property investors has risen over the last year but experts warn there is a slowdown. According to Council of Mortgage Lenders, homeowners have borrowed £8.7 billion for house purchases in February, which is up 4% than the previous month and 21% more than 2015. First time buyer borrowing jumped 21% year on year but this was overcome by the 61% increase in landlord borrowing. There was a 17% decrease in remortgage activity to £4.8 billion, even though this was up 37% year on year.

Paul Smee, director general of the CML, says: “Activity has been boosted by landlords seeking to complete purchases before tax changes in April. We do not expect activity to show such strong year on year growth later in the year.”

David Whittaker, managing director of mortgage brokerage Mortgages for Business, says: “Over the next few months, the buy to let market is expected to be quieter down somewhat as landlords take time to factor in the cost of the new stamp duty charges and, perhaps more importantly, work out new investment strategies.”

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