In the third quarter buy-to-let volumes rose by 23%, house purchase by 18%, remortgaging by 4.3% and first-time buyer lending increased by 13.5%.
From August to September buy-to-let, remortgage and first-time buyer volumes rose by 23.3%, 20.2% and 4.0%, while house purchase volumes were unchanged. Homemover volumes bucked the trend by falling by 2.9%
Paul Smee, director general of the CML, said: “The market was a slow starter this year, but this quarter shows it is now firmly on an upward trajectory.
“With competitive rates and high levels of product choice currently available, alongside generally improving economic conditions, we expect this to continue as we head into the New Year.
“Buy-to-let continues its growth this period, but at 18% of new lending in September remains the fourth largest lending type behind first-time buyers, homemovers and remortgage.
“There were five times as many house purchase loans to homeowners as buy-to-let landlords in September, and the growth in buy-to-let lending largely continues to reflect its more belated recovery from recession.”
In September buy-to-let represented 18% of gross lending.
Andrew Turner, director at Commercial Trust, said: “It is clear that buy-to-let is continuing to show real improvement, growing far more quickly than any other type of lending and continuing its trend of being the strongest UK mortgage market in the years since the recession.
“Though the bulk of both gross activity and yearly growth was remortgage loans, property purchase loans have also seen a more than modest climb – despite the continuously changing legislative environment in which landlords operate and the threat of increased buy to let regulation, both from pan-European legislation and the Bank of England itself.
“If the past few years have shown us anything, it is that buy-to-let has been the biggest driver of the housing market recovery, and instrumental in servicing the housing needs of the UK. Whilst it is crucial that we do not return to the risky lending conditions seen prior to the recession, it is equally crucial that we do not stifle landlords’ ability to continue to invest and provide homes we desperately need.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, reckoned this is a promising period for first-time buyers.
He said: “The number of first-time buyers continues to grow, as they take advantage of the plethora of high loan-to-value deals available.
“However, a fall in pricing means that first-time buyers are not overstretching themselves as they are paying a record low proportion of their monthly household income to service their mortgages.
“Landlords may be disgruntled by recent tax changes announced in the Summer Budget but they can’t complain about some of the cheapest buy-to-let rates ever. Moreover, there has been some movement on criteria with BMS tiering its stress rates, for example.
“Excellent mortgage rates continue to attract homemovers and remortgagers, with Precise, TSB and Accord just three of the lenders cutting rates in the past week or so. With Leeds Building Society increasing its maximum LTV on new build by 5% cent to 90% on houses and 85% on flats, lenders are demonstrating a keenness to lend which is good news for anyone looking for a mortgage over the next few months.”
