First-time buyers returned to the market in droves during October, with the value of loans advanced to those making their first steps on the housing ladder rising by nearly 50 per cent year-on-year.
According to figures published by the Council of Mortgage Lenders today, the value of loans to first-time buyers totalled £3.7bn in October, representing a jump of 16 per cent from the month before and a massive 48 per cent from the previous October when first-time buyer loans totalled £2.5bn.
A total of 26,800 loans were advanced to first-time buyers in October – a rise of 16 per cent from September’s 23,200 and 33 per cent compared to last October’s 23,200.
The average loan size to first-time buyers reached its highest ever level at £119,500. Moreover the average first-time buyer’s income has also reached record levels – £36,460.
Home mover loans totalled 33,900 in October – up 19 per cent on the 28,600 advanced in September and 16 per cent from 29,200 last October. The value of home-mover loans amounted to £5.9bn, a jump of 16 per cent on the previous month’s £5.1bn and 23 per cent from October 2012 when the total reached £4.8bn.
The remortgage sector saw a slight decline in October with a total of 28,300 loans advanced – down 12 per cent from the September figure of 32,300 and 3 per cent decline from the year before when 29,100 remortgage loans were advanced.
Remortgage loans in the month totalled £4.2bn in value, 11 per cent down from £4.7bn in September and 14 per cent from £3.7bn in October last year.
Buy-to-let advances also increased by 11 per cent from September, with a total of 16,200 loans advanced in October compared with 14,600 the month before. The value of these loans totalled £2.1bn – up 10.5 per cent from the £1.9bn advanced in September.
Council of Mortgage Lenders director general Paul Smee says: “After years of a relatively flat mortgage market, 2013 has shown signs of lending turning a corner and looks set to finish the year strongly.
“Increased financial optimism among the public as the economy recovers seems to be driving this upward trend and it is welcome to see that first-time buyers continue lending momentum as more look to own their first home.”
Anderson Harris director Jonathan Harris says: “The mortgage market continued to perform strongly in October with an increase in the number of loans to first-time buyers, landlords and homeowners moving to another property.
“First-time buyers continue to return to the market in their droves with the typical loan size the highest ever recorded.”