New data from the Council of Mortgage Lenders on the characteristics of lending in August show that lending declined slightly compared to July, the first month-on-month drop in house purchase lending volume since February this year.
First-time buyer lending declined in August compared to July, with 28,900 first-time buyer loans - 4% fewer than in July but 9% up on August 2013. By value, there was £4.4 billion of lending to first-time buyers - 4% down on July but 22% higher than August last year.
Lending to home movers also declined, with the number of loans advanced to movers totalling 36,500, a 3% fall on the previous month but up 7% on August last year. By value, lending to movers totalled £7 billion, 3% down on July but up 17% on August last year.
Remortgage lending activity saw a decrease month-on-month and also year-on-year in August. The number of remortgages in August was 4% down on July and 11% down on the same month last year. The value of these loans (£3.7 billion) was down 5% on the previous month and down 3% year-on-year.
Buy-to-let lending fell 13% over the month to £2.1 billion in August, but increased 11% compared to August last year.
Total gross lending in August was £18.1 billion. This was 8% lower than July (£19.7 billion) but 10% higher than August last year (£16.4 billion), according to the Bank of England.
House purchase lending to home-buyers decreased month-on-month in August totalling 65,400 loans. This was down 3% compared to July with the value of these loans totalling £11.4bn, a fall of 3%. Compared to August 2013, the number of loans increased by 8% and the value of lending by 19%.
First-time buyers saw the first month-on-month lending decline since January this year, with 28,900 first-time buyer loans in August - 4% fewer than in July, but still 9% up on August 2013. By value, there was £4.4 billion of lending to first-time buyers in August - 4% down on July but 22% higher than August last year.
The typical loan size for first-time buyers also fell slightly month-on-month to £126,198 in August, down from £127,500 in July. The typical gross income of a first-time buyer household changed slightly £38,649 in August from £38,866 in July. First-time buyers in August paid 19.7% of gross income towards covering capital and interest payments, little changed from 19.6% in July and still significantly less than they were in December 2007.