£5.6bn surge in first-time buyers’ loans

FIRST-TIME BUYERS borrowed a total of £5.9bn in June – marking a 26 per cent surge on May amid a “busy month” for the mortgage market, according to banks and building societies.

Trade association UK Finance, which released the figures, said first-time buyer borrowing was also up by nine per cent compared with June 2016.

Despite the upswing in activity in June, UK Finance said it did not believe overall performance levels would be sustained in the second half of 2017, amid signs that the market is now softening.

People taking their first step on the property ladder took out bigger loans in June compared with the previous month, at £139,000 on average in June compared with £137,000 typically in May, its figures showed.

Separate figures released jointly by the Office for National Statistics (ONS), Land Registry and other bodies showed that, across Britain, the average first-time buyer faced paying 4.9 per cent more in June for a home than they did a year earlier, with the typical price paid at £188,947.

UK Finance’s figures also showed that home-movers borrowed £7.8bn in June, which was also by up 26 per cent on May.

Paul Smee, head of mortgages at UK Finance, said: “June’s figures show a busy month in the mortgage market, with homemovers having their highest monthly activity levels for over a year and an especially high number of loans for first-time buyers.

“Buy-to-let activity subdued compared to peak.” remains its 2015