The data shows that the £6.1bn of new lending during August was 5.2% more year-on-year and that the average first-time buyer is 30 and has a gross household income of £42,000.
According to the data 38,000 new homemover mortgages were completed in the month, some 2.3% fewer than in the same month a year earlier. There was no change in the amount of new lending (£8.5bn) as the same month last year. UK Finance data shows that the average homemover is 39 and has a gross household income of £57,000.
New homeowner remortgages completed in August this year stood at 37,100 - a 0.3% dip year-on-year with no change in the £6.5bn of remortgaging as the year previous.
BTL home purchases were down 13% to 6,000 comapred to August 2017. By value this was £0.8bn of lending in the month, 20% down year-on-year.
There were 13,800 new buy-to-let remortgages completed in the month, some 4.5% cent more than in the same month a year earlier. By value this was £2.2bn of lending in the month, 4.8% more year-on-year.
Jackie Bennett, Director of Mortgages at UK Finance, said: “Overall house purchase completions remain stable, driven largely by the number of first-time buyers which reached its highest monthly level since June 2017.
Buy to Let remortgaging saw relatively strong growth in August, due in part to the number of two year fixed deals coming to an end. This suggests that while new purchases in the buy-to-let market continue to be impacted by recent tax and regulatory changes, many existing landlords remain committed to the market.
However, the homeowner remortgaging market has softened slightly, reflecting the many borrowers who had already locked into attractive deals in the months preceding the Bank of England’s base rate rise.”
Liz Syms, CEO at Connect for Intermediaries, says “Today’s figures show a mixed picture, which tells a story of the continuing unease felt surrounding Brexit and also the wider economy.
The continued pressure on landlords is mirrored in the number of buy-to-let purchases. However, although there are some landlords that have taken recent changes as a sign to leave the sector, there are still plenty actually looking to increase their portfolios. We are also seeing an increase in the number of portfolio landlords looking at longer-term fixed rate mortgages, which is manifest in the increase in remortgages in the month. With more products available, for longer-terms, this is a trend that is likely to continue, at least until we are more certain about the outcome of Brexit negotiations.”
Simon Heawood, CEO of Bricklane.com comments: “Buy-to-let landlords have been hit by a number of reasons to sell up their properties in recent years, from increasing taxation to stronger protections for tenants. This means as many as 44% of landlords are considering selling their properties, despite many remaining attracted to the residential property market itself. The good news, however, is that there are now alternatives through which investors can access residential property returns, but in ways that are tax-efficient, diversified and good for tenants, without the drawbacks of direct buy-to-let.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, says: "First-time buyers really are proving to be the lifeblood of the housing market, responsible for keeping the number of overall house purchase completions at a stable level. Lenders continue to offer competitively-priced high loan-to-value products to attract them and with property prices softening in some areas, there are good opportunities for those trying to get on the ladder for the first time.
Buy-to-let remortgaging remains strong as a core of experienced landlords remain committed to the sector, despite recent tax and regulatory changes. Lenders remain keen to lend and product innovation continues. The Chancellor should leave the sector well alone in the Budget and give it time to recover from the onslaught it has been on the receiving end of in recent times."
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: "Although reflecting activity a few months earlier, and overall a relatively flat market, there is some good news. There are no signs of a major correction to the housing market as predicted by some, with first-time buyer numbers reaching a 14-month high. Many are taking advantage of opportunities as buy-to-let landlords continue to suffer from tax and regulatory changes.
It remains to be seen whether the Budget actually encourages more potential first-time buyers to take the plunge before rising rents, prompted by shortage of property to let, makes deposit-saving even more difficult."
John Philips, operations director of Just Mortgages and Spicerhaart said: “Today’s figures show that the number of first time buyers have reached their highest level since 2017. Considering that homemover mortgages are down, this just shows how much of an impact incentives aimed at first time buyers - e.g. the stamp duty freeze and help to buy – are having.
Buy to let mortgages for purchase are also down, which suggests new landlords are reluctant to come into the market following all the changes over the past 18 months, including most recently, the new EPC and HMOs rules. However, buy to let remortgage is up, which is positive as it shows those landlords already in the buy to let sector still have an appetite to stay, despite all the regulations being thrown at them.
Overall, things are quite subdued in the housing market, and we can see that it is first-time buyers that are boosting the whole sector. And while this is positive now, what happens when the help to buy scheme ends and stamp duty is brought back in? The government needs to be thinking about some more long term solutions otherwise the market is going to really slow down. I think a re-haul of stamp duty would certainly help, and I think we also need to see some incentives that encourage first time buyers to buy older homes too; this could really help move things along the chain.”
