Mortgages  

First-time buyers lending back to 2007 levels

First-time buyers accounted for 11,200 loans for house purchase in London in the second quarter of 2013, the largest quarterly number since the end of 2007, figures from the Council of Mortgage Lenders reveal.

In the second quarter, 56 per cent of house purchase loans were to first-time buyers in London compared to 46 per cent in the UK overall.

In the second quarter of 2013, the 11,200 loans advanced to first-time buyers in London marked an increase of 19 per cent on the previous quarter and an increase of 38 per cent compared to the second quarter of 2012.

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Typical loan amounts have also increased, a knock-on effect of strong house price growth in the capital, up 6.9 per cent in the second quarter compared to 2.9 per cent for the UK overall.

This results in a larger growth in the value of lending to first-time buyers, CML said.

Total house purchase lending in London was boosted by the increase in lending to first-time buyers and showed an increase of 16 per cent compared to the first quarter and 18 per cent compared to the second quarter of 2012.

There were 20,100 house purchase loans advanced in London worth £5.1bn in total, a 23 per cent increase in value compared to the first quarter of 2013 and up by 20 per cent compared to the second quarter last year.

Paul Smee, director general of the CML, said: “Mortgage lending in London has followed a similar pattern to the rest of the UK with strong house purchase activity this quarter, strengthened particularly by first-time buyer activity.

“Total lending for house purchase has also increased this quarter upon last and from a year ago which suggests increasing confidence that economic conditions are becoming more favourable.”