The Council of Mortgage Lenders (CML) has reported a 3% increase in the number of first time home buyers in February with the first two months of the year showing the largest number of first time buyers since the same period in 2008.
A total of 16,400 loans were made to first time property buyers in February, which is an increase on the figure of 15,900 in January. In February 2012 the figure was 14,000. The total value of these loans was £2 billion, which compares with the figure for February 2012 of £1.7billion. Of all the home loans made in February, 43% were to first time buyers. What this all means to landlord insurance clients remains to be seen. Some will think that if people are now finding it easier to buy their own homes it will reduce the number of potential renters. Others point to the increasing population and therefore the growing need for accommodation.
The CML believe that indicators of loan affordability also suggest that the market was marginally more favourable for first time buyers in February. This group typically borrowed 3.19 times their income in the February, slightly down on the figure of 3.19 in January. The average loan to value ratio remained at 80%.
The increase in activity among first time buyers has not been repeated in the “home mover’ sector where lending actually fell in February for the third month in a row. The Government’s recent initiatives are widely expected to stimulate activity amongst those wishing to move up the ladder.
The CML represents banks, building societies and other lenders who between them undertake something like 95% of all residential mortgage lending in the UK. If you are interested in looking at all the facts and figures on the mortgage market visit their site: www.cml.org.uk
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