UK Finance: FTB mortgages at highest levels since 2007

First-time buyer mortgages reached 35,010 in August 2019, the highest monthly total since August 2007 according to UK Finance’s Mortgage Trends Update.

The figures seen in August for first-time buyer mortgages represents a year-on-year increase of 0.7%.

Homemover mortgages saw a yearly decline of 5.5%, whilst new remortgages with additional borrowing also declines by 2.9%.

For these remortgages the average additional amount borrowed in August was £55,000, with 18,100 new pound-for-pound remortgages recorded during the month.

There were 5,900 new buy-to-let home purchase mortgages completed in August 2019 which is a year-on-year decline of 3.3%.

In addition there were 13,800 remortgages in the buy-to-let sector which is 0.7% fewer than in the same month in 2018.

Tomer Aboody, director of MT Finance, added: “Encouragingly, first-time buyer mortgages are up on last year, which isn’t too surprising considering the low rates and high loan-to-values being offered by lenders, along with a greater number of lenders fighting for market share.

“Lower stamp duty or even nil stamp duty on lower priced property has proved a huge boost to the first-time buyer market. This is coupled with a sense of urgency from some in trying to get on the housing ladder before Brexit – there may be uncertainty now but who knows what the future holds?

“Fewer homemover mortgages isn’t surprising at all. These are usually at the higher end of the pricing bracket, where people are more cautious in spending until either we have a resolution in the Brexit saga or the Labour party is nowhere to be seen in the running for government, given its potential disastrous policies in housing.

“A drop in buy-to-let mortgages has become the norm and is unlikely to change until the second home additional stamp duty charge is either removed or lowered.”

Louisa Sedgwick, director of sales – mortgages at Vida Homeloans, added: “Today’s data shows a reasonable degree of resilience among the first-time buyer market.

“We know that first-time buyers across the country face can face different challenges depending on where they want to buy.

“Every mortgage tells a different story and it’s key that lenders listen and respond to the needs of borrowers.”

Adrian Moloney, sales director at OneSavings Bank, commented: “Buy-to-let activity is heading in the right direction, however, it’s still too early to say this is a trend with any meaning.

“Yet, with uncertainty pervasive in the market and the crackdown on taxation still having repercussions for landlords’ profits, this is encouraging news and highlights the resilience of the market.

“At the same time, there are bargains to be had, while mortgage rates remain low and employment rates high.

“It seems landlords are acting now, rather than continuing to wait and see what next month’s Budget has in store.

“Landlords evidently continue to consider bricks and mortar to be a good investment, and with demand for rental property still high the level of activity we’re seeing now could become the new normal.”

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