Monthly mortgage lending increases for first time in five months, forecast

Small deposit buyers continued to increase their share of UK mortgages in April 2017 as the overall market grew for the first time since November 2016, e.surv has predicted.

The surveyor’s latest Mortgage Monitor found the proportion of loans to those with small deposits to put down on a home increased for the fourth successive month, from 21.4% to 21.5%.

In December 2016 their market share was 16.1%, and this rose to 18.7% in January and again to 20.5% in February.

Large deposit borrowers – defined as those with a deposit of 60% or more – took 34.6% of the market in April. This was slightly higher than the 34.4% recorded in March but still down on the 2017 high of 35.4% recorded in January.

On a regional basis, Northern Ireland saw more small deposit borrowers than anywhere else during April 2017, with this tranche making up 34.6% of loans.

Northern Ireland, north-west England and Yorkshire were the only three regions where there were more small deposit buyers than large deposit ones. In Northern Ireland, 28.9% of loans went to large deposit buyers while in Yorkshire it was 25.4% and in the north-west 24.3%.

Scotland saw the smallest proportion of loans go to first-time buyers and others with small deposits at 18.4%, below London where 20.2% of all loans went to smaller buyers.

The UK capital saw 38% of its mortgage approvals made to borrowers with a large deposit, the highest proportion recorded in this survey.

Across the whole market, the surveyor has forecast that there were 67,035 loans approved in April, up 0.3% since March and 1.7% higher year-on-year. It is the first monthly increase since last November.

Richard Sexton, director of e.surv chartered surveyors, said: “April was a positive month for the UK mortgage industry with the overall size of the market growing on a monthly basis for the first time since November 2016.

“There was even better news for first-time buyers and others with small deposits. Their share of the market has risen yet again in April. That is not to say there aren’t significant challenges ahead, but data from the market this month is overwhelmingly positive.”


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