Mortgage completions soared in April - CML

Mortgage completions rose 16% to 35,600 in April, according to the latest data from the Council of Mortgage Lenders (CML).

However, activity is still very low compared to an average of 88,000 finalised deals in April over the last seven years.

Elsewhere, gross mortgage lending in April slipped to £10.5bn from £11.5bn in March.

Lending criteria continued to edge down with a typical home mover putting down a 33% deposit and borrowing 2.63 times their income, compared with 30% and 2.69 in March.

There were 22,100 loans to home movers worth £3.1 billion, compared with 30,600 loans worth £5 billion in April last year.

The research revealed there were 13,500 loans to first-time buyers worth £1.4bn, compared with 18,800 loans worth £2.4bn in April 2008. The average first-time buyer had a 25% deposit and borrowed 2.96 times their income.

The number of remortgage products continued to fall with 31,000 in April, 22% down on March and 65% down on April last year as low reversion rates and stricter credit criteria for the best deals made refinancing less attractive.

Additionally, the CML data also revealed a rise in the number of people opting for fixed rate mortgages. In April, 69% of borrowers took out fixed rate mortgages with an average rate of 4.83%, the highest share since June 2008.

Bob Pannell, head of research at the CML, says: "With the interest rate cycle now at its floor, an increasing proportion of borrowers are taking out fixed rates, including for longer term periods of 5-10 years.

"There are tentative signs of house purchase lending stabilising, but we need to see considerably higher transaction levels to underpin house prices."

stephen.quigley@incisivemedia.com