Gross mortgage lending hit£17.9bn in January as the market saw a21% year-on-year increase, according to the latestCouncil of Mortgage Lenders estimates.
Whilstthis is some 9% lower than December’s lending total of £19.8bn it does represent the highest lending total for a January since 2008 (£25.2bn).
CML economist Mohammad Jamei said:“Lending started the year on a positive note. Our monthly estimate is 21% higher than a year ago, with the current growth rate in lending similar to the closing months of 2015.
“UK market fundamentals are helping to underpin this recovery, with real wage growth, an improving labour market, competitive mortgage deals, and government schemes all supporting household demand. We still only see limited upside potential going forwards, as the number of properties for sale on the market remains low and affordability pressures weigh on activity. Upcoming tax changes in the buy-to-let sector are adding an element of uncertainty to the market.”
Charles Haresnape, group managing director for mortgages at Aldermore, added:“Data released today shows that the overall level of activity in the housing market ended 2015 stronger than when it started, and with gross mortgage lending levels up 21% year-on-year and the annual arrears rate at its lowest for more than a decade, we expect to see these encouraging trends to continue into 2016.
“A positive aspect to highlight is the broad-based spread of the data, with first-time buyers, movers and remortgage customers all seeing strong year-on-year growth. With the government’s plans for 400,000 new affordable homes and proposals to streamline planning approvals for developers, we hope to see a rise in construction levels over the coming years that should help to ease the supply pressures currently present in the market, leading to a more sustainable level of property price increases.”
