First-time buyer numbers slip back
The number of mortgage approvals in May rose by 1.2 per cent from the same month a year earlier, standing at 65,801, according to the firm’s latest Mortgage Monitor.
However, the report found that May’s lending total did drop back slightly from April’s figure, falling by 0.7 per cent month-on-month.
The surveyor the growth came at a time when activity in the property market has tailed off in many areas, with many local markets showing little signs of growth.
Fewer small deposit borrowers
The proportion of loans given to first-time buyers (FTBs) and others with small deposits also declined when compared to April’s figure, dropping by 0.7 per cent to 27.7 per cent of all loans.
Although, this figure is still ahead of the 26 per cent recorded in March, on an absolute basis, the number of small deposit borrowers dropped from 18,748 to 18,227.
E.surv said this demonstrated the strong performance of the first-time buyer market, even when others were holding off on making purchases.
Meanwhile the number of loans to those with larger deposits grew modestly from 24.3 per cent to 24.5 per cent.
This meant it was mid-market borrowers who increased their share of the market most substantially, growing from 47.2 per cent to 47.8 per cent month-on-month.
The North West failed to leapfrog Yorkshire, with the latter taking the crown as small deposit hotspot once more in May.
In Yorkshire 34.9 per cent of all loans went to this part of the market, higher than all rival regions.
In the North West, the nearest challenger, this figure was 33.7 per cent. The only other region to record over 30 per cent was the Midlands, which registered a total of 31.3 per cent this month.
At the other end of the scale, London was the most difficult market for these borrowers, with just 17.5 per cent of loans in the capital made to these customers.
London was also dominated by those with large amounts of equity, with 32.8 per cent of all loans going to those with cash to splash.
This is ahead of South East, which recorded 27.9 per cent, and Eastern England, which was 25.9 per cent.
By contrast, the proportion of large deposit borrowers in Yorkshire was 19.1% and in the North West 19.3%.
FTBs are still desperate to get onto the ladder
Richard Sexton, director at E.surv, said the strength of the remortgage market means many mid-market borrowers, who often benefit most from switching, are flocking to lenders in search of a cheaper deal.
He added: “The doom and gloom in the property market seems a mile away from the positive stories coming out of the mortgage market.
“While few people are moving when they don’t have to, first-time buyers are still desperate to get onto the ladder.
“As for existing homeowners, they are being tempted into the market by near record low interest rates. Those looking to switch could save hundreds of pounds a month by moving to a cheaper deal from a rival lender.”