Gross lending is forecast to end 2019 at £264 billion, down from £269 billion in 2018.

Moving forward to 2020, gross lending could drop again to £254 billion before notching up to £257 billion in 2021. UK Finance says this is driven by “underlying affordability pressures increasingly rippling out from the South East across the country”.

The figures are broken down to a slight rise in residential homeowners from £135 billion in 2018 to £137 billion in 2019 but going down to £134 billion and £133 billion in the following two years.

Remortgaging and PTs

Residential remortgaging is down from £82 billion last year to an estimated £79 billion in 2019 with forecasts of £76 billion in 2020 going back up to £79 billion in 2021.

Product transfers could go up to £164 billion in 2019 from £158 billion last year, then drop to £141 billion in 2020 and £147 billion in 2021.

More borrowers are opting for mortgage deals fixed for longer periods, in particular five year fixes which will lead to a drop off in remortgage and product transfers in the next couple of years.

Buy-to-let

Buy-to-let is down from £11 billion last year to an estimated £10 billion in 2019 and 2020 going back up to £11 billion in 2021.

Remortgaging in the buy-to-let space is steady this year and last year at £29 billion going down to an estimated £26 billion in 2020 and 2021.

Arrears and possessions

Arrears continue to fall, down from 82,400 in 2018 to an expected 74,900 this year. With unemployment at historic lows and the economy at virtually full employment, there is only one way for unemployment to go. With some job losses on the horizon arrears are forecast to go up next year to 77,900 then up to 81,000 in 2021.

Possessions are also forecast to rise from 6,900 in 2018 to 8,000 this year followed by 8,100 in 2020 and 8,300 in 2021.

UK Finance says the rise in possessions is explained by “an unwinding of a temporary cessation in possession activity in previous periods, whilst lenders adjusted their procedures to ensure compliance with new FCA guidance on treatment of customers in arrears.”

With this unwinding process largely complete, there is reason to expect possession trends will realign with those in mortgage arrears.