Mortgage lending to buy-to-let investors remained largely unchanged in August despite an overall increase in residential mortgage lending, according to the latest figures from UK Finance.
The seasonally adjusted data reveals that the number of buy-to-let loans in August was similar to July, but edged up by 4% to 20,400 when measured against the corresponding month last year.
The figures also show that buy-to-let borrowing for property purchase rose by 11% in August, but remained at a lower level than before the introduction of the 3% stamp duty surcharge for additional homes in the spring of 2016.
Harry Landy, managing director of Enterprise Finance, commented: “Buy-to-let and re-mortgage lending activity has seen a fourth consecutive month of growth, which demonstrates borrower confidence in the market. That these positive figures come during a traditionally a quieter month for activity is particularly surprising.
“However, this month also sees PRA-enforced change in standards of buy-to-let mortgage applications has many in the industry concerned about the future prosperity of the market, so we’d sound a note of caution to those getting carried with August’s figures.”
Overall, the total number of loans for house purchase and remortgage jumped by 7.6% to 129,500 between July and August, UK Finance data shows, supported by a rise in activity among home movers and first-time buyer activity, while number of people remortaging over the past 12 months has been higher than in any period since late 2009.
“Activity picked up in August, and recent resilience ensured that borrowing by home movers was at its highest since March 2016, when transactions were boosted by an imminent increase in stamp duty,” said June Deasy, UK Finance’s head of mortgages policy.
Deasy added: “Over the last 12 months, the number of people remortaging has been higher than in any period since late 2009. With mortgage rates close to historic lows and the likelihood of a rise in official rates moving closer, the popularity of remortgaging looks set to continue.”