The beginning of the year saw a continuation of first time buyers snapping up homes before the end of the stamp duty holiday on 24 March.
Figures from the Council of Mortgage Lenders (CML) are the latest evidence that first time buyers are rubber stamping their mortgage deals in their droves before the initiative comes to an end.
From 24 March, first time buyers will once again have to pay a tax of 1% of the price they pay for the new home.
The number of first time buyers increased by almost a quarter (23%) in January compared with the same month in 2011, with 13,200 loans worth £1.6 billion being approved.
"Average deposits for first-time buyers have stayed steady at around 20% for over a year but that figure may start to drift down gently over the coming months especially as NewBuy has been launched for new homes," said Paul Smee, director general of the CML.
The NewBuy scheme was announced as being 'open for business' yesterday by the Government.
It is hoped that the scheme – which will allow 100,00 buyers to secure their first or next step on the property ladder with deposits of as little as 5% - will give the mortgage market a much needed boost, while creating thousands of jobs for housebuilders.
The deal will mean that instead of a typical buyer requiring a £40,000 deposit for a £200,000 property, they will now only need £10,000.
Other data from the CML showed that both house purchases and remortgages fell in January, as is customary in the first month of the year.
Some 35,600 loans (worth £5.3 billion) were taken out for house purchases in January, a rise of 22% by volume and 23% by value from a year ago but a fall of 25% by volume and 24% by value on December 2011.
Meanwhile, 26,600 loans (worth £3.6 billion) were taken out for remortgaging, down from 28,200 (worth £3.5 billion) in December.
Remortgage lending experienced its first year-on-year fall since the end of 2010, with the number of loans down 13% and the value down 5% from January 2011.
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