Despite fears that the London property market is cooling figures from the CML (Council of Mortgage Lenders) have revealed that a total of £19.1 billion was advanced to borrowers during the month of July – this figure is in fact the highest mortgage lending has been since August 2008.
The pick-up in large mortgage borrowing can be partly attributed to an adjustment to the changes inflicted as a consequence of the mortgage market review in April. These changes meant that lenders had to “stress-test” applicants to ensure they would be able to meet repayments if interest rates were to rise.
Although the market remained “robust” according to the CML there was certainly a notable decrease in lending in the months following April as lenders formalised their responses to the changes.
The CML’s breakdown of mortgage lending at large in June showed that borrowing was being driven by homebuyers. It further demonstrated that remortgage activity was low – despite suggestions that interest rates might rise in the next year. At Enness, we found this figure to be surprising as we have received a number of enquiries to remortgage to fixed rates amidst fears of the base rate rising.