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London sees slowest rate of increase in first-time buyers

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The first-time buyer market in London is increasing at a significantly slower rate than in other parts of the country, according to research by the Council of Mortgage Lenders (CML).

While the market for first-time buyers in the capital increased 6 per cent in the past year, it lagged behind Scotland, Wales and Northern Ireland which saw increases of 15 per cent,18 per cent and 25 per cent respectively.

The CML’s study looked at data across the four regions in relation to house buying activity.


First-time-buyers took out 13,300 loans, totalling £3.3bn, this is the highest figure since 2007. The average loan size was £221,997 with the typical borrower taking a loan 3.86 times their gross income. Home movers borrowed a total of £3.7bn with an average loan size of £290,000. Remortgaging loans totalled £3bn in value with a total 11,400 loans advanced in the period.


The total amount borrowed by first-time-buyers was £810m this quarter, the highest in any quarter since 2007. The typical borrowing rate was 2.94 times gross income with the average loan size at £98,307. Home movers borrowed a total of 1.3bn this quarter with an average 16.6% of gross income being spent to cover monthly capital and interest payments. There was a total of 6,100 remortgage loans, totalling £670m in value.


The typical loan for first-time buyers surpassed the £100,000 mark for the first time since 2007 averaging £100,800. Borrowing was typically 3.23 times gross income.  The average amount borrowed by homeowners was £121,599 with 17.5 per cent of gross income being spent to cover monthly capital and interest payments. Remortgage lending totalled £340m accounting for 3,100 loans.

Northern Ireland

Lending to first-time buyers in this quarter as in the previous quarter was at its highest level since 2006. The typical loan size for first-time buyers was £80,000 wihile the average amount borrowed was 2.73 times gross income. The average loan for a home mover was £103,500 in the third quarter down from £104,000 in the previous quarter.

The average home mover in Northern Ireland paid 16.1 per cent of their gross income on monthly capital and interest payments. Remortgage lending in the third quarter totalled 1,100 loans, accounting for £110m in value.

David Newnes, director of Reeds Rains and Your Move estate agents, said: “The UK housing market has been thoroughly rejuvenated in the seven years since the crisis, and while conditions may have cooled in recent months, we’re still seeing a spirited flow of mortgage lending. And this energy looks set to continue making progress into 2015.”

Newnes said that schemes like Help to Buy have provided some extra backing to other regions where property values are stalled, by championing first-time buyers.

“Northern Ireland, Scotland and Wales have all outpaced the capital in terms of annual growth in first-time buyer borrowing during Q3. It’s encouraging to see these activity levels being reinforced, but this support needs to be sustained and widespread across the country to put the memory of the recession to bed.”

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