First-time buyer lending up 33%!

The volume of mortgages taken out by first-time buyers in August was up by 33% from twelve months previously, according to data released today by the Council of Mortgage Lenders.

A total of 27,100 loans were advanced to first-time buyers in August 2013, up from just over 20,000 last year. This also represents a seven per cent rise from July 2013. The value of first time buyer lending in August reached £3.8bn, up by 46% from last year and the average LTV advanced rose from 80% last year to 81% in August 2013.

SPF Private Client’s chief executive Mark Harris says: “There was a significant jump in first-time buyers in particular in August, with 33% more loans advanced and a 46% increase in the value of those loans compared with the same period last year.

“The mortgage guarantee phase of Help to Buy will boost the numbers of first-time buyers although the rates announced so far are disappointing. With a government guarantee behind them, you would expect lenders to be able to offer cheaper products. However, as more lenders join the scheme rates should fall further.”

Lending for home-owner purchase continued to show growth in August with 61,300 purchase mortgages completed, a seven per cent increase from July and 15% from August 2012. The total value of house purchase loans in August reached £9.7bn, representing a 20% rise from twelve months prior.

Total buy-to-let lending fell slightly from £2bn in July to £1.9bn in August with a total of 14,900 loans advanced to landlords in August. This was down from 15,200 in the previous month.

A 4.1% dip in remortgage lending to landlords was noted in the CML data with 6,900 buy-to-let loans advanced in August compared with 7,200 in July. The value of remortgage buy-to-let lending fell to £1bn in August from £1.1bn the month before.