The outstanding value of all residential mortgage loans was £1.44bn in the final quarter of 2018, illustrating growth of 3.3% when compared to Q4 2017, figures published by the Bank of England (BoE) revealed.

In its Mortgage Lenders and Administrators Statistics – 2018 Q4, the bank found that the value of gross mortgage advances increased by 5.5% in the year to Q4 2018, rising to £72.9bn. Furthermore, the value of new mortgage commitments amounted to £68bn, with this figure also being 4.6% higher than a year earlier.

However, despite remortgaging figures typically being higher throughout 2018, the figures published by the BoE highlighted that the share of lending for remortgage was just 1.4% higher than a year earlier, at 31.1%, while the share for house purchase was 1% lower, at 63.5%.

Furthermore, of the mortgages advanced in the final quarter of 2018, 4.4% of them had loan to value (LTV) ratios exceeding 90%, compared to 3.8% in Q4 2017, drawing attention to lenders ability to be flexible despite economic and political uncertainty.

The proportion of high loan to income lending remained at 46.9% in the quarter, the highest value since the series begin in the first quarter of 2007.

Commenting on the data, Responsible Lending managing director Keith Haggart said: “Buyers are stuffing their pockets while they can, with the proportion of high loan-to-income loans higher than at any time since 2007.

“Low interest rates are responsible for this, and cheap borrowing continues to trump economic outlook when it comes to borrowers’ appetite to forge ahead.

“Remortgages are taking an increasing slice of the pie and that’s to be expected because we already know transaction volumes remain on the floor by historic standards.

“Volume of sales will have to improve before this trend moves back in the other direction but it is owner-occupiers whose activity remains sluggish. First-time buyers have not been deterred from the market at all. They are going to be on the ladder for longer and clearly believe property is still a rock solid investment over the long term.”

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