First-time buyers boost mortgage market activity

Mortgage market activity increased in January partly due to first-time buyers aiming to beat the end of the stamp-duty holiday, Connells Survey and Valuation reports.

According to the company’s most recent Housing market activity report, the number of valuations specifically for first-time buyers was up a full 52 per cent compared to January 2011. This represents a two per cent monthly decline compared to December 2011 but shows valuations for first-time buyers grew as a proportion of the market last month. First-time buyers accounted for 32 per cent of all valuations completed in January 2012, the highest proportion since June 2011.

The number of overall residential valuations conducted in January was up 43 per cent year-on-year. However, this also market a decline of 15 per cent since December 2011.

Buy-to-let valuations showed the least year-on-year growth at 21 per cent. The data showed that home mover valuations grew 40 per cent and those for remortgages grew 48 per cent.

Despite showing the slowest year-on-year growth, the Council of Mortgage Lenders today (9 February) said buy-to-let mortgages are playing a “really important role” in the overall housing market.

John Bagshaw, corporate services director of Connells Survey and Valuation, said: “A comparison against the strongest December since the downturn masks the underlying strength of the valuations market in January. The ongoing affordability of mortgages, not to mention lenders’ increasing commitment to higher loan to value lending, has helped boost valuations activity.

“However, there has also been a strong uplift in first-time buyer activity, with new buyers rushing to beat the end of the stamp duty holiday in March.

“In turn, this has unlocked activity further up property chains.”