June borrowing reaches highest level for almost a decade

August 3, 2016 by Brendan O'Neill

Borrowers

According to the Council of Mortgage Lenders, the amount of borrowing for June 2016 was at its highest point in the last eight years.

According to estimates, the amount borrowed during June reached £20.7 billion. This amount is a 3% increase in the figure for 2015, while it is 16% higher than May this year. In June, the number of homes sold also increased, by 4.9% according to HMRC. The figures coincide with the period up to the EU referendum, which took place on 23rd June, and indicate that buyers didn’t wait for the results before buying a property.

However, the Halifax stated that the higher levels of borrowing also reflect the increasing house prices, which are rising at 8.4% per annum. The senior economist for CML, Mohammad Jamei, stated that house buying activity is likely to slow down in the coming months, and that lending will more likely to be for re-mortgaging a property rather than buying a new one.

The report by HMRC also indicated that during June this year, there were 94,500 properties sold, which was more than the previous month, but lower than the same month last year.

Although the lending figures for June are higher than expected, they are still lower than the amount for March this year, when lenders distributed £26.1 billion. However, the surge in lending for that month was attributed to the introduction of new stamp duty rates in April.

CeMAP trained mortgage advisers are able to help borrowers find a suitable mortgage when they are looking for a home.