Buy-to-let house purchase lending was under half what it was in the in the months leading up to the stamp duty changes, while buy-to-let remortgage is by value 10% lower than levels seen in January and February before the surge in activity in March, the latest figures show.
The latest monthly lending data from the Council of Mortgage Lenders reveals that gross buy-to-let lending continues to be lower than usual, with the amount landlords borrowed in May falling by 4% year-on-year to a total of £2.6bn.
The decline was expected following the surge in activity to beat the stamp duty changes on second properties ahead of the April 1 deadline.
"Buy-to-let lending continues to be lower than usual, which was expected after the surge in activities ahead of the stamp duty changes in April, but it's telling that this had much more of an impact on the market than Brexit," said CML director general Paul Smee.
But in a sign that confidence is slowly returning to the buy-to-let market following a slump in activity after the stamp duty surcharge was introduced in April, the amount landlords borrowed in May did actually rise by 4% compared with the previous month.
In total, 16,600 loans were issued to buy-to-let landlords, up 3% compared to April but down 8% compared to May 2015.
In contrast, first-time buyer lending shot up by 23% year-on-year to £4.3bn in May, although the figure is down 15% compared with April.
Remortgage lending rose by 30% year-on-year to £5.2bn in May, but also fell 15% on April.
"The data shows the market was actually more confident than expected in the month leading up to the referendum - significantly first-time buyer borrowing outweighed home movers for two months running, for the first time in 20 years," said Smee.
He added: "Uncertainty is ongoing, but with a new PM taking office earlier than planned and the Bank of England due to cut the cost of mortgages, the market is quickly getting back to normal. What is clear is that lenders are still open for business, and our own data shows that plucky buyers are readying to swoop in and grab a bargain."
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