The Courier & Advertiser (Perth and Perthshire Edition)
Borrowing trend at point not seen ‘for 20 years’
Strong activity among first-time buyers is matching the levels of mortgage borrowing by existing homeowners moving house – in a trend not seen for 20 years, according to banks and building societies.
A total of 48,600 loans were handed out for homeowner house purchase in February, around half (24,200) of which went to first-time buyers, with the remaining 24,400 going to homemovers, the Council of Mortgage Lenders (CML) said.
The number of firsttime buyer loans was up by 11% year-on-year, while house purchase lending to home movers was down by 5.8% yearon-year.
On average, first-time buyers need to put down a 16.2% deposit, the CML’s figures show.
Paul Smee, director general of the CML, said: “Borrowers took out more loans to purchase a home in the first two months of 2017 than any year since 2007. This is down to strong first-time buyer activity which has consistently matched home-mover borrowing over the past six months, a trend not seen in the UK for 20 years.”
There have been suggestions that firsttime buyers have been given a window of opportunity by the fall in buy-to-let investors buying properties.
The CML’s figures show buy-to-let lending for house purchase plummeted by 44.7% annually in February, with 5,700 loans advanced.
A stamp duty hike for buy-to-let investors was imposed on April 1 last year, and there were signs of investors rushing to buy properties early last year before the deadline.