November first-timer sales surge
Completions stood at 34,300 in November, up from 29,900 in October and 26,400 a year ago.
Average rates meanwhile fell by 0.27% fell to 3.92% – a 4-year low.
Adrian Gill, director of estate agents Your Move and Reeds Rains, said: “Record low rates have set off a blast of first-time buyers over the last month, with the number of completions climbing upwards to reach a post-recession high.
“Mortgage rates are slipping downwards, helped by low inflation and growing certainty that an upwards revision of the base rate is moving away from the horizon of the New Year and deep into 2015.
“At the same time, wages have finally leapfrogged inflation – meaning people are starting to feel slightly richer – and repayments are shrinking as a proportion of their income.”
First-timer deposits fell by 4% year-on-year to stand at £25,991 in November, while average prices were £151,020 after falling by 4% from October.
Despite the positive month, the e.surv chartered surveyors’ mortgage monitor recently revealed that lending above 85% LTV fell by 18.3% in October and 5% in September.
Gill added. “First-time buyer activity has been boosted by cheap rates over the last month, but there are early signs that lending has dropped off again, suggesting the pipeline of approvals is starting to dry up slightly.
“The mortgage market has been faced with a host of regulatory changes over the last year – including changes implemented in the Mortgage Market Review and LTI caps introduced in October.
“Mortgages are more accessible than ever, but the proportion of lending to higher LTV borrowers is falling away a little.”
Changes to Stamp Duty in the Autumn Statement will have the most significant effect on first-time buyers in London, who paid £290,158 in the three months to November.
Under the new regime, first-time buyers paying this price would have been liable for Stamp Duty of around £4,500 compared to £8,700 before the introduction of the graduated system.
Gill said: “The government unveiled a revised Stamp Duty structure in the Autumn Statement, and this will further nurture demand at the lower end of the market.
“But while it will have a big impact in the capital, the changes will be less noticeable elsewhere – and in some areas where the average price of a first-time buyer property is still beneath the bottom tier, they may be negligible.
“Still, the media buzz surrounding the announcement has pepped up interest regardless.”