Taylor Scott International News
The mortgage market in the UK remains driven primarily by lending for house purchase, rather than remortgage, according to the latest data from the Council of Mortgage Lenders. There were 30,200 first time buyer loans in July, up 3% from June and 25% up on July 2013. By value, there was £4.6 billion of lending to first time buyers in July, some 10% up on June and 39% higher than July last year. Lending to home movers also grew. In July, the number of loans advanced to movers was 37,500, 15% up on the previous month and 19% on July last year. By value, lending to movers totalled £7.2 billion, 20% up on June and 31% up on July last year. Remortgage lending remains muted compared with both first-time buyer and home mover lending. The number of remortgages in July was 4% up on June but 15% down on July last year. The value of these loans at £3.9 billion was up 3% on the previous month and down 5% on July last year. Buy to let lending grew 9% over the month to £2.4 billion in July, and an increase of 26% from £1.9 billion in July last year. House purchase lending to home buyers increased month on month in July totalling 67,700 loans, up 10% compared to June and the value of these loans totalled £11.8 billion, a rise of 15% on June. Compared to July 2013, the number of loans increased by 21% and the value of lending by 33%. The typical loan size for first time buyers continued to rise to £127,500 in July, up from £123,750 in June and the highest average loan size for a first time buyer on record. The typical gross income of a first time buyer household also grew to £38,900 in July compared to £37,095 in June. First time buyers' in July paid 19.6% of gross income towards covering capital and interest payments, up from 19.3% in June, but still significantly less than the recent peak of 24.8% in December 2007. Home movers typically borrowed 3.03 times their gross income in July, compared to 3.08 in June. The typical loan size for home movers was £156,000 in July, up from £153,800 in June. The typical gross household income of a home mover was £54,400 in July compared to £52,000 in June. ‘The market has shown steady growth in house purchase and buy to let over the past few months with general improvements in economic factors across the UK allowing for more people to enter the property market,’ said Paul Smee, director general of the CML. ‘There have been many factors over the past year that could have caused disruption but the market has remained resilient and lenders have shown themselves adaptable to all this change. The CML will continue working towards making sure future initiatives affecting the market, such as the European Mortgage Credit Directive, are introduced with equally minimal disturbance to borrowers and lenders,’ he added. Taylor Scott International
Taylor Scott International, Taylor Scott
