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Lending to FTBs hits 6-year high in London and Celtic nations

Lending to first-time buyers hit at least a six-year high in London and the Celtic nations in the fourth quarter, according to figures released today by the Council of Mortgage Lenders.

In the fourth quarter of 2013, 13,400 loans were advanced to first-time buyers in London – the highest quarterly total since the third quarter of 2007.

The Q4 figure is up 33 per cent compared with the fourth quarter of 2012, when 10,100 loans were advanced. In total, £3bn was advanced to first-time buyers, up 49 per cent on roughly £2bn in Q4 2012.

There were 10,400 advances to home movers in London, compared to 9,600 in Q4 2012 – an 8.3 per cent increase year-on-year. The total value of these loans was £3.2bn in the fourth quarter, a 21 per cent increase on £2.6bn a year earlier.

The total number of remortgage loans advanced in London increased 19 per cent over the period, up from 9,400 in Q4 2012. There was £2.8bn advanced to remortgage borrowers, up 36 per cent from roughly £2bn over the same period.

CML chief economist Bob Pannell says: “First-time buyers have continued the strong upward trend in lending we have seen throughout 2013 and, despite much debate in political spheres about their affordability plight in the capital, an increasing number are realising their aspirations to become homeowners.”

London was not the only part of the country to witness impressive lending performance to first-time buyers in the fourth quarter, with Scotland, Wales and Northern Ireland all boasting lending levels not seen since the financial crisis.

In Scotland, there were 6,700 loans advanced to first-time buyers, a 26 per cent increase on the 5,300 loans advanced a year earlier. This was the highest number of loans advanced since the fourth quarter of 2007. By value, £680m was lent to first-time buyers, up 39 per cent on the £490m in Q4 2012.

The number of loans to home movers in Scotland was 8,600 in Q4 2013, a 19 per cent increase on the 7,200 loans advanced a year earlier. The value of these loans increased 26 per cent year-on-year from £906m to £1.2bn over the period.

There were 6,800 loans to remortgage customers in Scotland, down 4 per cent on the 7,100 remortgage loans a year earlier. The value of these loans rose 4 per cent year-on-year, though, from £710m to £740m.

Wales also saw the highest quarterly total of loans to first-time buyers in the fourth quarter of 2013 in six years.

In total there were 3,200 loans to first-time buyers in the last quarter of 2013, a 28 per cent increase on the 2,500 loans advanced a year earlier.  The value of these loans rose by 33 per cent over the period, from £240m in Q4 2012 to £320m a year later.

Growth in lending to home movers in Wales was not as strong as to first-time buyers although at 4,000 loans, the fourth quarter figures were still up 11 per cent year-on-year. The total value of these loans was £500m in Q4 2013, a 16 per cent increase on the £430m advanced a year earlier.

There were 3,700 loans for remortgage purposed in the third quarter, up 6 per cent on the 3,500 loans a year earlier. In value, the amount advanced increased 15 per cent from £330m to £380m.

The number of loans advanced to first-time buyers in Northern Ireland grew to its highest level since mid-2007 in the fourth quarter of 2013.

First-time buyer lending was up 29 per cent in Northern Ireland in the fourth quarter, from 1,400 in Q4 2012 to 1,800 a year later. In value, lending increased 27 per cent from £110m to £140m over the same period.

The number of loans advanced to home movers in Northern Ireland was 1,100 in the fourth quarter of 2013, up 10 per cent on the 1,000 loans in the fourth quarter of 2012.

There were 1,300 loans for remortgage in Northern Ireland in Q4 2013, up 8 per cent on the 1,200 loans advanced a year earlier. In total the value of these loans increased 9 per cent from £110m to £120m over the same period.

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