More homeowners are choosing to stay in their properties instead of moving to a new property, after the Council of Mortgage Lenders (CML) revealed mortgage borrowing dropped in April.
It reported the amount of money home movers borrowed declined by 53 per cent from March to April, with banks lending just £4.3 billion to this group of people. This is also 14 per cent lower than in April 2016.
Homeowners borrowed £8.1 billion, which is a drop of 40 per cent from March, taking out 47,300 loans in total.
Director general of the CML Paul Smee noted the fall in mortgage activity could be the result in “significant rises” the month before, with borrowers trying to get a loan before the second stamp duty came into effect.
He added: “We expect the market to take several months to return to its previous levels after the lending surge.”
The decline could also be the result of more people choosing to renovate their properties by installing double glazing, bi fold doors and conservatories in Manchester instead of moving home.
Zopa recently revealed homeowners are trying to improve their properties for the long-term, with chief executive officer Jaidev Janardana saying it is “significantly less expensive and disruptive” than buying another home.
However, CML’s findings also showed a decline in first-time buyer activity, with this group borrowing 11 per cent less than in march at £3.9 billion. Despite this, banks lent them 15 per cent more than in April 2015.
Indeed, FTBs took out 25,100 loans during April this year, which is seven per cent more than the same month in 2015.