Mortgage lending falls by nearly 30%
Mortgage lending fell back by nearly a third in April as a stamp duty hike for buy-to-let investors came into force, lenders have reported.
The Council of Mortgage Lenders (CML) estimates that gross mortgage lending reached £18.5bn in April. This was 29% or £7.7bn lower than March's lending total of £26.2bn.
With buy-to-let investors now taking more of a "back seat" in the housing market, first-time buyers and home movers are expected to be driving the market in the coming months.
On April 1, a three percentage point stamp duty increase was imposed for people buying second homes, such as buy-to-let investors.
Stamp duty has been abolished in Scotland, but similar tax increases took place there to mirror the stamp duty changes in the rest of the UK.
Estate agents reported dealing with a bottleneck of investors rushing to beat the hike before April 1 and many investors will have brought forward property purchases that would otherwise have taken place later in the year.