Commentary on Mortgage lending statistics - December 2019

The FCA and the Prudential Regulatory Authority (PRA) both have responsibility for the regulation of mortgage lenders and administrators. We jointly publish the mortgage lending statistics every quarter.

Since the beginning of 2007, around 340 regulated mortgage lenders and administrators have been required to submit a Mortgage Lending and Administration Return (MLAR) each quarter, providing data on their mortgage lending activities.

Key findings

  • The outstanding value of all residential mortgage loans was £1,486 billion in 2019 Q3, 3.9% higher than a year earlier (Table A).
  • The value of gross mortgage advances was £73.3 billion, broadly unchanged in comparison to 2018 Q3 (Table A and Chart 1).
  • The value of new mortgage commitments (lending agreed to be advanced in the coming months) was 1.1% higher than a year earlier, at £73.8 billion (Table A and Chart 1).
  • The share of mortgages advanced in Q3 with loan to value (LTV) ratios exceeding 90% increased to 5.9%.  Lending in this LTV bracket is at its highest since 2008 Q4 (Chart 3).
  • The share of gross mortgage lending for buy-to-let purposes (covering house purchase, remortgage and further advance) was 12.3%, consistent with 2018 Q3  (Chart 5). 
  • The value of outstanding balances with some arrears fell significantly to £13.7 billion, and now accounts for 0.92% of outstanding mortgage balances (Chart 6).

Download the data from the charts below - MLAR statistics: detailed tables (Excel)

Chart tips: hover over data series to view the data values and filter the data categories by clicking on the legend. 

Table A: Residential loans to individuals flows and balances 

Regulated and non-regulated mortgages - £ billions - Not seasonally adjusted

 

Q2

Q3

Q4

Q1

Q2

Q3

 

2018

 

 

2019

 

 

Business flows

 

 

 

 

 

 

Gross advances

66.7

73.5

72.9

63.4

66.1

73.3

New commitments

73.2

73.0

67.9

63.7

73.4

73.8

 

 

 

 

 

 

 

Residential loan amounts outstanding

 

 

 

 

 

Total Regulated and Non-regulated

1,418.0

1,430.2

1,443.7

1,452.3

1,466.6

1,485.7

Chart

Data table

  • The value of gross mortgage advances was £73.3 billion, broadly unchanged in comparison to 2018 Q3 (Table A and Chart 1).
  • The value of new mortgage commitments (lending agreed to be advanced in the coming months) was 1.1% higher than 2018 Q3, at £73.8 billion.

Chart

Data table

  • The distribution of interest rates relative to Bank Rate for gross mortgage advances has remained broadly unchanged since 2018 Q3 (Chart 2). 
  • The share of mortgages advanced with interest rates 3% or more above Bank Rate decreased further to 5.7%, and continues to be at its lowest since 2008 Q3. 
  • The share of gross advances with interest rates over 2%, but less than 3%, above Bank Rate was 10.2%, and the share of loans with interest rates less than 2% above Bank Rate was 84.1%. 

Chart

Data table

  • The share of mortgages advanced in Q3 with loan to value (LTV) ratios exceeding 75% increased to 41.1%, 3.1 percentage points (pp) higher than 2018 Q3 (Chart 3). 
  • The share of gross mortgage lending in Q3 with LTV ratios exceeding 90% increased to 5.9%. This is at its highest share since 2008 Q4. 
  • The share of mortgages advanced at LTVs over 95% has remained broadly unchanged since 2017 Q1, at 0.3%.

Chart

Data table

The proportion of lending to borrowers with high loan to income (LTI) ratios was 47.2% this quarter, in line with 2018 Q3 (Chart 4).  Borrowers with high LTI are defined here as: 

  • Borrowers with a single income who had an LTI ratio of 4 or above. These loans accounted for 10.8% of gross mortgage lending in Q3, a share which has been broadly unchanged since 2018 Q1. 
  • Borrowers with a joint income who had an LTI of 3 or above. These loans accounted for 36.4% of gross mortgage lending in Q3, in line with 2018 Q3.

Chart

Data table

The share of gross mortgage advances for buy-to-let purposes (covering house purchase, remortgage and further advance) was 12.3% in 2019 Q3, consistent with Q3 figures in 2017 and 2018 (Chart 5). The share of advances to owner occupiers was 87.7%. 

  • Of the 87.7% of advances for owner occupation, the share for remortgage fell to 28.0% of gross advances. The share for house purchase increased to 53.2%, 1.3pp higher than in 2018 Q3. Further advances and other mortgages (including lifetime mortgages) accounted for 6.4% of gross advances combined.  
  • Of the 53.2% of advances for house purchase by owner occupiers, lending to first-time buyers rose 0.9pp compared to a year earlier, to 21.9% of gross advances. This is the first year-on-year increase since 2018 Q1. The share advanced to home movers was 31.3%, which is its highest since 2017 Q3. 

Chart

Data table

  • The value of outstanding balances with arrears (defined as the borrower failing to make contractual payments equivalent to at least 1.5% of the outstanding mortgage balance or where the property is in possession) fell by 3.5% on the quarter, to £13.7 billion (Chart 6). 
  • Consistent with that, the proportion of total loan balances with arrears continued to decrease on the quarter, reaching 0.92%, the lowest since the series began in 2007 Q1. 

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