Buy to let lending is strong

Slow start to year for home movers and FTBs

Both home mover and first-time buyer numbers dwindled in the first quarter of this year, according to the Council of Mortgage Lenders.

It said first-timers took out 61,300 mortgages in the first three months – down 24% on the last quarter of 2014 and down 11% on the same period last year.

Home movers took out 70,400 loans, a 25% decrease on the last quarter of 2014 and a drop of 11% on the same period in 2014.

Buy-to-let lending, in contrast, was strong.

There were 52,000 buy-to-let loans in the first three months of 2015. While this was a 3% drop on the previous quarter, the figure was up 15% on the first quarter of last year.

The quarterly figures were improved by a monthly increase in loans in March when the number of house purchase loans totalled 48,200, up 16.4% on February. Nevertheless, March’s figure was almost 4% lower than the same month in 2014.

In March, the number of buy-to-let loans for house purchase increased 29% on March the year before.

According to another set of official figures – from the Office for National Statistics – UK house prices in March rose 9.6% on the same month the year before.

Brian Murphy, head of lending at the Mortgage Advice Bureau, said that given that the increase “far outstrips wage increases, the higher rate of house price growth brings with it genuine concerns about affordability”.

The ONS says “average mix-adjusted house prices” in March stood at £284,000 in England, £173,000 in Wales, £145,000 in Northern Ireland and £207,000 in Scotland.

The average house price in London was £498,000.

Excluding London and the south-east, the average UK house price was £211,000.

In percentage terms, annual house price inflation was 9.4% in England, 14.6% in Scotland, 5.7% in Wales and 7.5% in Northern Ireland.

Blog Post from Property Industry Eye

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