Lending increased for both mortgage and remortgages but at a slower pace in March.  The data from the Council of Mortgage Lenders (CML) revealed that the number of new mortgage loans amounted to 4% more in March than in February and 17% more than the same month a year ago.  First time buyers took 24,400 mortgages in March which was 24% more than March 2013.  The first quarter resulted in 34% more first time buyers than in the first quarter of last year.

The number of mortgages for property purchases in the first quarter fell by 16% compared to the previous quarter but there was an increase of 27% over the first quarter of 2013.

Home owners were still in demand of cheap remortgage deals it appeared despite the Mortgage Market Review (MMR) thought to possibly squelch the demand by a large margin.  The MMR requires remortgage and mortgage borrowers to reveal intimate information as to their spending and saving habits to assure responsible borrowing. 

Homeowners in March took out 2% more remortgages than reported in February by the CML and 5% more than in March 2013.  The number of remortgages declined in the first quarter of 2014 in comparison to previous quarter by 6% but increased by 14% in comparison to the first quarter of 2013.

Remortgages in March increased to 25,000 loans with a value of £3.6 billion.

Paul Smee, director general of CML said, “All types of lending show positive year on year growth but the rate of increase is not as frenetic as at the end of 2013.”

Commenting on the impact of the MMR guidelines for lenders, Mr. Smee said, “The industry was ready for the transition and already actively implementing many of the changes prior to April. We do not anticipate prolonged disruption to the market as a consequence. But we still see affordability constraints as an important factor in determining the level of demand for mortgages which we see over the next year.”