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FTBs account for half of new mortgages

First-time buyers account for nearly half of all mortgages taken out in December, Mortgages Directs monthly research reveals.

It attributes the upsurge in first-time buyer taking out mortgages, an increase of 11% from November to 48% in December, has been driven by increased income multiple lending and buyer confidence in financial security.

Peter Gladdy, director of Mortgages Direct, says: The dramatic increase in first-time buyers in December, accompanied by a slight increase in buy-to-let mortgages, goes against all normal seasonal trends and may well reflect a renewed determination to get onto the housing ladder.

The general optimism evident in the house price predictions for 2007, which range from growth of 3.5% to as much as 10%, has also helped these buyers take the plunge.

Mortgage Direct says December recorded the highest level of first-time buyers in the entire year.

Gladdy adds: First-time buyers have been able to take advantage of some good fixed rate deals and the high level of loans may also be a reflection of the increased generosity of lenders offering income multiples of up to five times.

However, first-time buyers should be careful not to over-stretch their finances and make sure that they are confident about being able to afford the repayments, especially when deals end.


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