The mortgage market experienced a pre-summer boost in May as lending to first-time buyers and home movers increased, figures suggest.
Data from banking trade body UK Finance shows that the number of approvals for first-time buyer mortgages increased 8.1% annually to 32,200, while home mover loans increased 4.4% to 31,100 over the same period.
Remortgaging continued to see a climb, up 7.1% annually in May to 36,000.
There was still little respite for landlords, though, with approvals for buy-to-let mortgages down 9.8% annually to 5,500.
Jackie Bennett, director of mortgages at UK Finance, said: “The mortgage market is seeing a pre-summer boost, driven by a rise in the number of first-time buyers and strong remortgaging activity. It is also particularly encouraging to see an increase in home movers, after a period of relative sluggishness in this important segment of the market.
“However, affordability remains a challenge for some prospective buyers and this is reflected by a gradual increase in loan to income multiples.
“Meanwhile purchases in the buy-to-let market continue to be constrained by recent regulatory and tax changes, the full impact of which have yet to be fully felt.”
John Phillips, group operations director at Just Mortgages and Spicerhaart, described the data as “the most encouraging for some time”.
He said: “We are starting to see a glimpse of some of the strong first-time buyer activity of 2017, and even more encouragingly, an uplift in home mover activity. This section of the market has been really slow of late, with affordability and a lack of houses making it tough for second and third steppers to make their next move.
“However, while these figures are encouraging, it could be more to do with a pre-summer boost than a real step change. Because overall, more needs to be done to help home movers.”
Source: Property Industry Eye