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FTB numbers rise as mortgage lending climbs higher

FTB numbers rise as mortgage lending climbs higher

Category: Mortgages

Updated: 16/01/2012
First Published: 16/01/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The number of successful first time buyers increased towards the end of last year, according to the latest data supplied by mortgage lenders.

New figures from the Council of Mortgage Lenders (CML) revealed first time buyers took out 17,300 loans in November, 4% higher than the previous month and a year earlier.

Those taking their first step onto the property ladder continued to see a decline in the proportion of their income accounted for by mortgage interest payment, dropping to 12.2% in November compared to 12.3% in October and 13% the previous November.

In its Autumn Statement in November, the Government announced that a temporary exemption from stamp duty would come to an end on 24 March 2012.

The exemption, which was implemented in March 2010, means that first time buyers do not have to pay the 1% stamp duty on properties costing less than £250,000.

Elsewhere amongst the CML data it was revealed that mortgage lending overall climbed higher in November.

Loans for house purchase totalled 47,000 during the month, some 3% higher compared to November 2010 and 4% up on October 2011.

Remortgaging volumes also increased, being 6% higher than the previous month and 2% up on November 2010.

Meanwhile, fixed rate mortgages increased in popularity to their highest point in more than two years.

Almost two thirds (65%) of all borrowers took out a fixed rate during the month, up from 62% in October, a move the CML said may be because a rise in interest rates 'seems more likely, although not imminent, and borrowers may want to lock in to current favourable rates'.

"A rise in mortgage lending towards the end of 2011 is a welcome indicator for the industry considering confidence has been weak due to fragile economies both at home and in the Eurozone," said CML director general Paul Smee.

"We should expect a further increase in first time buyer activity over the next few months as they push through their purchases to take advantage of the stamp duty concession before it ends in March."

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