The real estate market declines as buy-to-let purchases slip

Mortgages rose 4.6 per cent to £ 21.4 billion the year before in September, driven by an energetic remortgage sector, while buy-to-let (BTL) cooled, according to UK Finance data.

In the new loan market, the volume of first-time loans to buyers grew 1.6 per cent to 291,000 in September 2019 over the same month in 2018. The value was up five per cent to £ 5.1 billion, the banking agency revealed.

The volume of mortgages increased 1.8 per cent to 29,050 and the value grew 5.4 per cent to £ 6.6 billion.

In remort loans, the volume of additional borrowings rose 5.9 per cent to 17,740 and the value increase 5.1 per cent to £ 3.3 billion, with the average borrowed amount being £ 50,000. [1[ads1]9659003] Remortgages without further borrowing grew eight per cent to 19,140 volumes and 9.4 per cent to £ 3.4bn by value.

However, the BTL sector lagged behind. The number of mortgages fell 3.5 per cent to 5,500 and the value was down 11.1 per cent to £ 800m.

BTL remort loans were flat at 12,900 volumes and valued at £ 2.2bn.

Strongly in numbers [19659009] Industry watchers welcomed the generally positive image.

Nick Chadbourne, Managing Director of LMS, the transport provider, said: “We are starting to see a shift in the balance of power in this market. Lower prices on two-year agreements have created competition between lenders, and the goal is to turn the heads of remortgagers. Our recent data shows that although five-year fixes are still the most popular product, the purchase of two-year deals has increased. "

John Phillips, national director of broker Just Mortgages, said:" This is a strong set of numbers, with both new loans and especially remortgages showing a great improvement at the same time last year.

"Especially the eight percent increase in pound-by-pound remortgages is a welcome reversal of recent trends, where the increased incidence of long-term corrections has driven down volumes.

" This is offset by some of the rather steep decline in new BTL mortgages – more than 11 percent of the value There have been a number of changes in the regulations in recent years, not to mention the impact of the stamp on the BTL stamp ceiling, so it wouldn't be surprising if this prevents landlords from expanding their portfolios and put new players off completely, "Phillips added.

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