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Loans to Scottish first-time buyers leap 10%

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Scottish and Welsh first-time buyers saw a bigger increase in mortgages than their London counterparts in quarter one, according to Council of Mortgage Lender data.

Loans to Scottish first-time buyers increased by 10% and those to Welsh first-time buyers by 5% in Q1 2013 compared to the same period last year. By contrast, lending to first-time buyers in the capital remained flat at 9,400.

However, total lending to London’s first-time buyers was four times higher than that to Scots – at £1.85bn and £400m respectively.

CML Scotland chair Iain Malloch suggested government-backed schemes such as the Scottish MI New Home and Help to Buy should boost the Scottish mortgage market further: “With most adults in Scotland still viewing home-ownership as their tenure of choice and with more high loan-to-value mortgages now available, conditions for borrowers looking to either buy or move home are continuing to improve.”

While first-time buyer lending might have improved in the Celtic fringes, lending to home movers dipped both there and in the capital. The number of loans advanced to London home movers fell by 5% year-on-year, while those in Wales fell 13%.

The average loan-to-value for first-time buyers was lowest in London at 75% and highest in Wales at 85%.

Remortgage lending also remained subdued. Loans advanced in Scotland dropped 25% on Q1 2012 while those in London dropped 18% and in Wales by 19%.

Northern Ireland saw a fall in the number of advances to all types of borrowers. In total, gross mortgage lending in the first quarter fell by 15% year-on-year to £170m.

While lending may have fallen in many areas, a separate CML study also confirmed the desire to own a house was alive and well. Half of Londoners would like to buy a new house in the next three years while the vast majority of Scots said they wanted to be a homeowner in ten years’ time.

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