Mortgage lending picks up in Nov 2011
The amount lent to first-time buyers increased 5% to £2.1bn in November 2011 from 12 months earlier.
The number of loans advanced to first-time buyers increased 4% to 17,300 over the same period.
First-time buyers saw a decline in the proportion of their income going towards mortgage interest payments, down to 12.2% in November 2011 compared to 12.3% in October 2011.
The number of remortgage loans increased 2% to 31,200 and the value of remortgage loans totalled £4.0bn, an increase of 5% over the November 2010 to November 2011 period.
Fixed-rate mortgages increased in popularity to their highest point in more than two years in November as 65% of all borrowers took out a fixed rate, up from 62% in October.
This may be because a rise in interest rates seems more likely, although not imminent, and borrowers may want to lock in to current favourable rates.
Paul Smee, director general of the CML, said: “A rise in mortgage lending towards the end of 2011 is a welcome indicator for the industry considering confidence has been weak due to fragile economies both at home and in the eurozone.
“We should expect a further increase in first-time buyer activity over the next few months as they push through their purchases to take advantage of the stamp duty concession before it ends in March.”
Charles Haresnape, managing director of Aldermore Mortgages, said: “It is encouraging that CML data just issued showed November mortgage lending up 5% from the prior month and up 5% year on year.
“But more importantly than that, first-time buyers also increased in numbers, again up 4% and remain 37% of the total market.
“There will be many headwinds during 2012 but at least affordability is very strong and now it is all about consumer confidence.”