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Second time around for FTBs in CML stats

The Council of Mortgage Lenders has made the startling admission that its first-time buyer statistics do not actually relate exclusively to first-time buyers.

The trade body’s revelation this week casts doubt over the accuracy of its published research on one of the most emotive economic subjects.

A first-time buyer is classed by the CML as someone buying a home but not simultaneously selling one, meaning people returning to the market and people buying a second home are included.

The CML estimates that returners, which often include divorcees, make up one-fifth of the normal sample, which indicates that the figures are dramatically skewed.

The CML stated this week that a typical FTB is 29 and borrows an average of 3.27 times income at a typical 90 per cent loan-to-value. It makes no reference to methodology issues.

In August, the CML adm- itted that it does not have sufficient data on the non-conforming mortgage market to be taken seriously as an informed commentator.

This week, it was slammed by GMAC for allegedly dist- orting its lender league table by not comparing firms over the same time period.

CML spokesman Chris Dean says: “People buying second homes will be incl- uded in the FTB stats and so will returners.”

John Charcol senior technical director Ray Boulger says: “Because the CML stats are considered to be the Bible, to then produce stats that are misleading is unhelpful. It means that stats on average deposit, income and loan-to-value for an FTB are all wrong. Estate agents’ data is more reliable and that is dis- appointing. If the CML made it clear what the stats inc- lude, then that would mitigate the problem.”

Mortgages By Guy Anker


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