January 2016 - Mortgage Monitor

February 11, 2016Tags: mortgages

Buy-to-let growth boosts lending market

  • A surge in buy-to-let lending ahead of April’s tax changes means January sees 85,432 house purchase approvals, up 20.6% from 70,837 house purchase approvals in December 
  • Total house purchase approvals reach highest levels for nine years, alongside an annual increase of 39.3% – up from 61,341 in January 2015
  • First-time buyers have a positive January – as number of small-deposit loans granted reaches 12,388, increasing from 11,546 the previous month

As pressure mounts on the private rented sector ahead of tax changes set to be introduced in April, a growth in buy-to-let mortgage approvals has taken home lending to its highest peak in nine years, according to the latest Mortgage Monitor from e.surv, the UK’s largest chartered surveyor.

January saw 85,432 house purchase approvals – up 20.6% month-on-month from 70,837 in December 2015. This substantial monthly rise has been fuelled by an increase in buy-to-let investors, looking to beat upcoming legislative changes this April. It meant January saw the highest number of monthly house purchase approvals since 87,594 in October 2007 – nearly nine years ago.

On an annual basis, house purchase lending has risen 39.3% from 61,341 approved loans in January 2015. After a consistent run of annual increases, this yearly spike in house purchase lending signals the short-term impact of a surge in buy-to-let borrowing amid the wider strength of the lending market.