Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Mortgage Lending Falls in Q1, But Pipeline and BTL Activity Rise: BoE
The value of new mortgage lending in the UK fell by 12.3% in the first quarter of 2026 compared to the previous quarter, reaching £69.6 billion, according to the Bank of England. This figure was also 10.2% lower than the same period last year, but the value of new mortgages agreed rose by 11.5% on the last quarter to £78 billion, and was up 14.2% year-on-year.
The Bank of England’s Mortgage Lenders and Administrators report highlighted that, despite the decline in completed mortgages, the pipeline of new agreements points to a potential rebound in market activity. The report also noted a continued shift towards remortgaging, with the share of lending for remortgages among owner-occupiers increasing by 2.7 percentage points quarter-on-quarter to 28.1%, and up 6.8 percentage points compared to last year.
For letting agents and inventory clerks, the report showed a small rise in buy-to-let (BTL) lending. The proportion of gross mortgage lending for BTL increased by 0.5 percentage points from the previous quarter to 8.9%, and was 0.8 percentage points higher than the year before. Meanwhile, 91.1% of mortgages were advanced to owner-occupiers.
The share of owner-occupation lending for house purchase decreased by 3.9 percentage points to 57.7% compared to the last quarter, and was 8.6 percentage points lower than the previous year. Of this, lending to first-time buyers fell by 1.2 percentage points from the previous quarter to 27.4%, a 3.9 percentage point drop year-on-year.
Interest rates on new mortgages also shifted. The share of gross mortgage advances with interest rates less than 2% above the bank rate fell by 0.2 percentage points to 94.7%, the lowest since Q1 2023. The proportion of mortgages completed with interest rates between 2% and up to 3% above the bank rate rose by 0.1 percentage points to 3%, the highest since Q1 2023.
Source: Mortgage Solutions