Lenders dish out £62.1bn in three months as buy-to-let investors rush to complete deals before introduction of 3% stamp duty surcharge

Just weeks before gross mortgage lending for the first three months of 2016 totalled £62.1 billion (or about 53% of the entire NHS budget for 2015/16) one of Britain’s largest landlords sounded a warning the property boom is over.

In March alone, mortgage lending was 59% higher than the same month in 2015, according to the Council of Mortgage Lenders.

Fulham-based estate agent Lawsons & Daughters puts the spike in borrowing down to buy-to-let investors rushing to complete deals before the introduction of a 3% stamp duty surcharge.

But with many landlords now thinking twice about extending their buy-to-let portfolios, does this now mean that first-time buyers will have a better chance of getting on the property ladder?

The Royal Institution of Chartered Surveyors says its members expect house price growth to slow in the run up to the EU referendum on 23 June as clouds of political uncertainty cast a shadow over the UK property market.

However, RICS chief executive Simon Rubinsohn warns that if the pound falls in value – as commentators are predicting it will if Britain does vote to leave the EU – this could encourage overseas investors back in to the market.

When the pound is weak we tend to see more property purchasing activity in exclusive areas of London, such as Mayfair and Kensington & Chelsea, as overseas investors take advantage of their greater buying power.

While property values in London climbed about 10% in 2015, million-pound property sales in the capital slipped back 2% in the past 12 months after stamp duty reform levied higher taxes at the middle and top end of the market, says Garton Jones Westminster Estate Agents.

Whether Britain votes to leave the EU or not, the Grosvenor Group – which manages a £6.7bn property portfolio including a 300-acre plot of central London that encompasses the Mayfair and Belgravia areas – believes “it is only a matter of time” before years of rising property values go into reverse.

In its 2015 annual report, the property group said Grosvenor is continuing to “expect and plan for a slowdown, particularly in high-end commercial and residential property”.

For Grosvenor, this preparation includes selling assets and pursuing development opportunities expected to mature during the next market upturn.

This could be good news for first-time buyers who have found themselves priced out of the market in the capital, says East London estate agent Peach Properties.

The number of first-time buyers in the UK has recovered significantly since the financial crash, increasing from a low of 192,300 in 2008 up to 312,500 in 2015.

But while house price growth may slow, few are predicting properties in areas other than Mayfair or Belgravia will suffer significant falls in value.

London’s property boom is based on ultra-low mortgage interest rates and a drastic shortage of homes available for sale.

The Bank of England base rate has been frozen at 0.5% for seven years and economists suggest it will remain at its record low level for at least another 12 months.

Meanwhile, attempts to deliver more new-build homes in London and elsewhere in the UK are being held back by a shortage of skilled staff and a reluctance to invest in capital projects during times of economic and political uncertainty.

We may not see property increase in value at the rate it has done, but suggestions the property bubble is about to burst appear alarmist.