Homebuying dropped in January
The value of homebuying fell sharply in January compared to December, as £8.4bn was borrowed to purchase a property, said the Council of Mortgage Lenders.
But while this was a large 28% down on the previous month, a dip in January is expected. Year-on-year figures show a flat market both in terms of value and number of loans.
Homebuyer loans break down in first-time buyer mortgages and home movers and both showed similar dips. First-time buyer lending was down 29% on December while movers borrowed 25% less than the previous month. Over the year first-time buyer figures are more positive – up 9% on January 2016, compared to home mover borrowing which fell 7%.
At the same time, remortgaging is booming, as borrowers take advantage of current low mortgage rates.
Homeowner remortgage activity was up 54% by value and 46% by volume on December. Compared to January 2016, remortgage lending was up 22% by value and 21% by volume.
Paul Smee, director general of the CML, said: “January gives the impression of a flattish market overall, albeit one with a resurgent remortgage sector. We expect a seasonal dip in activity in the winter months and this appears to be the case in January.
“However, the lull in moving activity appears stubbornly persistent, and we have commissioned research on the reasons why the number of transactions seems in secular decline.”