Mortgage borrowing by homeowners and first-time buyers is showing "resilience" in the face of uncertainty around Brexit, boosted by the Bank of England's decision to slash interest rates.
The Council of Mortgage Lenders (CML) said in August there were 66,000 loans approved for house purchase, up 13% over the month and 9% annually. The value of this lending was £12.2bn, up 14% on July and 11% on the year.
Of those loans, 31,800 were for first-time buyers, up 12% month-on-month and 19% year on year. The value of first-time buyer mortgage lending was £5.1bn, a 13% rise on July and 24% on August.
"House purchase activity bounced back from a dip in July, reflecting resilience in first-time buyer activity," said Paul Smee, director general of the CML.
"Mortgage rates remain at, or close to, historic lows, and the repricing of mortgages following August's base rate cut should help to underpin a continuing, strong appetite for home ownership over the coming months."
The buy-to-let market, which has been hit with a number of tax hikes, including higher stamp duty and cuts to certain reliefs for landlords, is still subdued. Landlords borrowed £3bn, unchanged month-on-month but down 12% year-on-year, said the CML. There were 19,400 buy-to-let loans, up 4% on July but down 13% on August 2015.
"Buy-to-let by contrast continues to operate at lower levels five months after the stamp duty change on second properties," Smee said. "This appears to be a long-term trend, and with lenders potentially tightening affordability checks ahead of the tax changes in April 2017, activity on the buy-to-let house purchase side may well remain at current levels."