The number of first-time buyers in the first two months of the year was at its highest level since 2008, according to figures released today by the Council of Mortgage Lenders.
A total of 16,400 loans were advanced to FTBs in February, up 3.1 per cent on the 15,900 advances made in January and 17.1 per cent on the 14,000 advances made to these borrowers in February 2012.
By value, loans to FTBs totalled £2bn, the same as in January but 18 per cent higher than the £1.7bn advanced in February 2012.
FTBs accounted for 43 per cent of all house purchase loans in February, marking the sixth consecutive month FTBs have accounted for over 40 per cent of house purchase loans.
FTBs typically borrowed a smaller amount relative to their income in February compared with January. FTBs typically borrowed 3.19 times their income in February, down from 3.2 times in January, while the average loan-to-value remained at 80 per cent.
CML director general says: “First-time buyers are continuing to take advantage of more favourable market conditions, helping to drive the underlying trend for risilient house purchase lending.
”We hope that the new initiatives announced by the Government in the 2013 Budget will further stimulate first-time buyer activity but also help those second steppers looking to move into a new or existing home.”
Overall, lending to home movers fell 4 per cent between January and February, from 22,300 to 21,500, and down 3 per cent on the 22,200 loans advanced in February 2012. February’s drop marked the third consecutive month lending to home movers had fallen.
By value, home movers were advanced £3.5bn in February, a 5 per cent fall on the £3.7bn advanced in January.
House purchase lending was up 5 per cent year-on-year in February. A total of 37,900 loans, worth £5.5bn, were advanced compared with 36,400 loans, worth £5.4bn, the year before. However, there was a 0.8 per cent drop from January, when 38,200 loans were advanced, worth £5.7bn.
Remortgage lending remained subdued in February, down compared to both the previous month and February 2012. In February 2013, there were 19,500 loans advanced to remortgage borrowers, worth £2.6bn, which was 13.3 per cent lower than the 22,500 loans, worth £3bn, in January and down 30 per cent on the 28,200 loans advanced, worth £3.6bn, in February 2012.