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First-time buyer mortgage applications hit six-month high in March – First Direct

The value of mortgage applications submitted by first-time buyers reached £8bn in March, the highest amount in six months, data from a bank has shown.

The First Direct first-time buyer trends report based on data from CACI revealed that the value of applications in March was also 42 per cent up on February’s £8bn.

However, despite the application value reaching its highest level since September last year, the first quarter of 2023 was down by 26 per cent compared to the same period in 2022. In March last year, the first-time buyer application value reached £10.8bn, marking a two year high.

Activity was more subdued in April as the value totalled £6.2bn, however, this was the second highest amount in six months.

The mortgage market as a whole, including homemovers and remortgagors, reached a value of £26.6bn in March. This was the first time the value of applications passed £20bn since September last year, and it was also £8.9bn up on February.

Carl Watchorn, head of mortgages at First Direct, said: “Typically, March and April tend to be some of the busiest months of the year when it comes to first-time buyer activity. March usually sees a sharp spike in applications after what is often a quiet start to the year.

“It’s really encouraging to see the market recovering during March and April to a level of applications not seen since September 2022. A closer look at this data also reveals that the value of first-time buyer loans has doubled since Q4 last year; a segment fundamental for a vibrant housing market.”

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The average first-time buyer loan was £211,766 in April, which was an 8.8 per cent increase or more than £17,000 rise since the start of the year.

First Direct said it was also the highest figure since July 2022 when the average loan amount reached £212,153.

Loan sizes among first-time buyers saw the biggest jump, but average homemover loans also rose by 14,200 since January while there was a £9,500 increase in average remortgage loans.

Read about the UK Housing Market via our Specialist Residential & Buy to Let Division

Watchorn added: “The news that average first-time buyer loans are increasing is likely indicative of increased confidence in the sector, although it does once again highlight the challenge faced by many young people trying to bridge the gap between average income and the average house price.

“It’s also important to consider that the average first-time buyer house deposit is now more than £60,000. Faced with higher rates than we’ve seen in a number of years, many buyers will be looking to save up as big a deposit as possible in order to secure a cheaper rate against a lower loan to value (LTV) product.”

By Shekina Tuahene

Source: Mortgage Solutions

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November year-on-year mortgage lending falls

The number of mortgages completed in November 2019 was down by around one tenth on the same time last year for both first-time buyers and home movers, figures from UK Finance show.

There were 30,620 new first-time buyer mortgages, down 10.5% from November 2018, and 30,750 home mover mortgages, a drop of 10.6%. This movement reflects particularly strong home-purchase activity in November 2018.

The value of first-time buyer mortgages was £5,271 million while home mover lending stood at £7,012 million.


Remortgaging with additional borrowing in November 2019 rose by 5.7% year-on-year to 18,610 cases with the average additional amount borrowed being £51,470.

There were 18,470 new pound-for-pound remortgages (with no additional borrowing), which is down 12.4% from November 2018.


Buy-to-let home purchase loans fell in November 2019 to 6,300, which was 4.5% fewer than the same time last year. Remortgaging in the buy-to-let sector was also down, by 5.1% to 15,000 cases.


Rob Barnard, director of intermediaries at Masthaven, said: “These are mixed figures from UK Finance, however the mortgage market was resilient in 2019, particularly for first time buyers. This slight dip in completions could be a reflection of pre-election jitters. As certainty starts to build around the country, we should see a bounce bank in figures.

“However, the industry needs to ensure they are working to support the market. We need to capitalise on growing positive consumer sentiment and continue to offer products which suit modern lifestyles.

“As we move into 2020, we need to ensure later life and self-employed borrowers also benefit from increasingly flexible and innovative products and rates and we don’t leave any borrower groups locked out of the market”.

Nick Chadbourne, CEO of conveyancing solutions provider LMS, commented: “The continuation of low interest rates and competitive products from lenders ensured 2019 ended with a stable remortgage market.

“LMS data shows the gap between purchases of 5-year fixed rate products and 2-year fixed rate products has been closing steadily in recent months as borrowers take advantage of lower rates in place of longer-term certainty. It will be interesting to see if the balance will shifts one way or another moving into Q1 2020.

“All eyes are on the upcoming base rate decision. It will be interesting to see how lenders and borrowers react if there is a cut, as has been hinted at by prominent policy makers, given that it has been a while since rates last fell.”

By Joanne Atkin

Source: Mortgage Finance Gazette

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Remortgaging levels dip after strong period of growth

Remortgaging levels plummeted by 20% in October following a year of strong growth, the latest figures from UK Finance have revealed.

According to the Mortgage Trends Update for October, new remortgages with additional borrowing dropped off by 20.8% compared to the same month in 2018, with 18,910 being completed.

Meanwhile pound-for-pound remortgages, without additional borrowing, also plunged by 20% in October when 20,660 of these completions were recorded.

First-time buyer mortgages were more buoyant, with numbers up by 2.8% to 32,260 and there were also 33,370 home mover mortgages, which was up 4.2% when compared to the same month a year earlier.

In the buy-to-let market, figures were down slightly in October compared to the same month in the previous year. UK Finance reported there were 6,600 new buy-to-let home purchase mortgages, a dip of 1.5%.

Meanwhile, 16,200 buy-to-let remortgages were completed, down by 2.4% compared to October 2018.

Resilient market

Kevin Roberts, director of Legal & General Mortgage Club, described today’s figures as ‘mixed’ but pointed out they came at the end of a resilient year for the mortgage market.

He revealed the mortgage club had seen completion levels reach an all-time high in October. And he added: “Thousands of first-time buyers are continuing to take advantage of competitive rates to make the move into homeownership.”

Meanwhile, Mark Harris, chief executive of mortgage broker SPF Private Clients, said the fall in remortgaging numbers suggested many of those borrowers who needed to refinance had already done so and taken advantage of the cheap rates available.

He added: “First-time buyers continue to prop up the housing market with their numbers continuing to grow.

“Home mover numbers also edged up as those buyers brave enough to ignore political and economic headwinds got on with the business of moving.”

Many in the industry agreed the mortgage sector had clearly braved the Brexit uncertainty in October. They were keen to offer their views on how things would progress now there was more clarity following the Tory win in the general election.

Daniel Hegarty, founder and CEO of Habito, said its own analysis revealed online searches for getting a mortgage in the UK were up 113% over last Saturday and Sunday combined, compared to the same period in the previous week.

He added: “We’ll wait to see if this initial surge of online interest is backed up with more mortgage submissions and an increase in home-buying activity in early 2020. But, the very early signs look positive.”

By Kate Saines

Source: Mortgage Finance Gazette

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Could a no deal Brexit affect your mortgage? This is what the experts say

Is the reaction of the markets to a threatened no deal Brexit – or even an orderly Brexit – worrying you? How might it affect your finances, your mortgage repayments or even your chance of securing a new mortgage from your lender?

Some good news: the Bank of England has just announced that it will be holding the interest rates at 0.75 per cent for now. But if you are home owner, or only just looking into getting a mortgage as a first-time buyer, what does this announcement mean for you?

Martijn Van Der Heijden, Chief Strategy Officer at online mortgage brokerage Habito, comments on the implications of the decision for both first-time buyers and those already with a mortgage, ‘Interest rates remain relatively low which will be welcome news for those looking to get a good deal on their mortgage. This “wait and see” approach from the MPC (Monetary Policy Committee) is something we also see reflected in our own data with a surge in buyers choosing fixed deals for five years or more as they try to “Brexit-proof” their mortgage and lock in the same rate until 2024 and beyond.

‘We have also seen positive figures recently on the take up of buy-to-let and first time buyer mortgages, something which has led to lenders offering more competitive products to support people moving.’

A no deal Brexit could mean a sharp rise in inflation and the fall of the pound, which would mean that the Bank would need to reconsider interest rates, either raising or lowering them depending on what’s needed to support the economy.

So, it looks like now could be the time to consider securing the best fixed-rate mortgage if you are buying your first home or remortgaging. Doing this now could make particularly good sense given the stark warning the Bank of England has issued about the potentially detrimental effects of Brexit on the UK economy. And it will give you certainty. No bad thing in these uncertain times.


Source: Real Homes

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Northern Ireland mortgage market continues to show steady growth in house purchase activity

THERE were 2,700 new first-time buyer mortgages completed in Northern Ireland in the third quarter of 2018 – some 3.8 per cent more than in the same quarter of 2017, data from UK Finance has revealed.

The £280,000 of new lending was 7.7 per cent more year-on-year, the report said, adding that the average Northern Ireland first-time buyer is 30 and has a gross household income of £33,000.

There were 1,800 new home-mover mortgages completed in the north in the third quarter, 5.9 per cent more than last year and worth £240,000

Derek Wilson, chair of UK Finance’s regional mortgage committee, said: “The Northern Ireland mortgage market continues to show steady growth in house purchase activity.

“Lending to first-time buyers remains the largest sector by value, as borrowers take advantage of what continues to be the most affordable region in the UK.

“These figures underline the importance of boosting housing supply to meet this growing demand.”

Patrick Mullan, head of mortgages at Danske Bank, said: “The latest survey shows the market continues to grow steadily, with mortgage activity for first-time buyers, home movers and remortgagers in Northern Ireland all showing healthy increases from the same quarter last year, despite consumer confidence having been dented by ongoing uncertainty around the economic and political outlook.

“This consistent growth has been reflected in our own figures, which showed a 29 per cent uplift in new to bank mortgage lending across all borrower types in the third quarter when compared with a year ago.

“The first-time buyer market continues to demonstrate sustained growth and is the largest sector by value, with activity in the quarter up 3.8 per cent year on year.

“The strength of the first-time buyer market is also mirrored in Danske Bank’s own figures, with the bank now lending to one in four of all first-time buyers in Northern Ireland.

“The competitive deals on offer from many lenders and house-builders continuing to invest in new housing stock, could help explain the sustained growth in the first-time buyer market.”

He added: “While the Bank of England has said it will only raise interest rates very gradually, there is an expectation rates will increase at some point in 2019, which may drive further demand for fixed rate mortgages.

“We are seeing more people take out fixed rate mortgages, with increased demand for five-year fixed mortgages rather than shorter two-year deals, which may also be influenced by the current uncertainty around the possible impact of Brexit on the economy.

“There has been a steady increase in the number and value of home-owner remortgages compared with the same quarter last year, but we believe there is still room for further growth in this segment of the market into next year.

“In general, this survey indicates the housing market in Northern Ireland is still growing. We are still the UK’s most affordable region, so even as house prices continue to rise, these increases are reasonable and there is capacity for further sustainable growth going forward.”

Source: Irish News

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Remortgaging remains high but house purchase lending falls

There were more first-time buyers than home movers in June and house purchase lending was down on the same month last year, according to UK Finance’s Mortgage Trends Update.

A total of 34,900 new first-time buyer mortgages were taken out in June, 3.6% fewer than in the same month a year earlier. They collectively borrowed £5.8 billion, which is down 1.7% year-on-year. The average first-time buyer is 30 and has a gross household income of £42,000.

The number of new home mover mortgages completed in the month stood at 33,700, a drop of 7.9% compared to June last year.  Total new lending to home movers was £7.3 billion, down 6.4% on the previous year. The average home mover is 39 and has a gross household income of £56,000.

Remortgaging fared better, rising by 8.4% year-on-year to 37,400 new remortgages completed valued at £6.8 billion, a rise of 13.3%.

In the buy-to-let space, house purchase continued to decline in June while remortgaging remained steady.

There were 5,400 new buy-to-let home purchase mortgages completed in the month, 19.4% fewer than in the same month a year earlier. By value this was £0.8 billion of lending, a fall of 11.1 per cent.

Buy-to-let remortgages completions stayed at 12,600 and by value this was £2 billion of lending, the same as June 2017.


Jackie Bennett, director of mortgages at UK Finance, said: “Remortgaging continued to dominate in June with figures up 13% on the same period last year as existing two and three year products came to an end and borrowers opted for new deals.

“Despite a boost in recent months, speculation of a base rate rise saw the market remain relatively subdued with year-on-year declines in activity among both first-time buyers and home movers as customers adopted a ‘wait and see’ approach.

“House price inflation has moderated in recent months yet it still remains above earnings growth, and so affordability is still a challenge for would-be borrowers.

“And although the full impact has yet to be felt, tax and regulatory changes continue to bear down on borrowing activity in the buy-to-let purchase market.”

Source: Mortgage Finance Gazette

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First-time buyers and home movers get pre-summer lending boost

The mortgage market experienced a pre-summer boost in May as lending to first-time buyers and home movers increased, figures suggest.

Data from banking trade body UK Finance shows that the number of approvals for first-time buyer mortgages increased 8.1% annually to 32,200, while home mover loans increased 4.4% to 31,100 over the same period.

Remortgaging continued to see a climb, up 7.1% annually in May to 36,000.

There was still little respite for landlords, though, with approvals for buy-to-let mortgages down 9.8% annually to 5,500.

Jackie Bennett, director of mortgages at UK Finance, said: “The mortgage market is seeing a pre-summer boost, driven by a rise in the number of first-time buyers and strong remortgaging activity. It is also particularly encouraging to see an increase in home movers, after a period of relative sluggishness in this important segment of the market.

“However, affordability remains a challenge for some prospective buyers and this is reflected by a gradual increase in loan to income multiples.

“Meanwhile purchases in the buy-to-let market continue to be constrained by recent regulatory and tax changes, the full impact of which have yet to be fully felt.”

John Phillips, group operations director at Just Mortgages and Spicerhaart, described the data as “the most encouraging for some time”.

He said: “We are starting to see a glimpse of some of the strong first-time buyer activity of 2017, and even more encouragingly, an uplift in home mover activity. This section of the market has been really slow of late, with affordability and a lack of houses making it tough for second and third steppers to make their next move.

“However, while these figures are encouraging, it could be more to do with a pre-summer boost than a real step change. Because overall, more needs to be done to help home movers.”

Source: Property Industry Eye

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Remortgage activity bounces back in April

The latest mortgage trends report from UK Finance has shown a surge in both homeowner and buy-to-let remortgages, which one expert described as ‘Blitz Spirit’.

UK Finance’s latest Mortgage Trends Update revealed there was strong growth in remortgaging in April 2018.

New homeowner mortgages were up 36 per cent and buy-to-let remortgages were up 32.4 per cent compared to the same month a year earlier.

James Tatch, analytics expert at UK Finance, said the figures showed mortgage lending operating in a way that the group had previously described as a two-speed market.

He said: “In this case house purchase is relatively slow (strong first-time buyer numbers offsetting continuing weak activity where homeowners are looking to move) whilst remortgaging is showing strong year-on-year increases.”

There were 40,800 remortgages in April, a 36 per cent increase on the same month a year ago.

Mr Tatch said the remortgaging activity was driven by a fear of coming rate hikes, along with a number of relatively attractive deals currently on the market.

The first-time buyer figures were particularly strong.

There were 26,700 new first-time buyer mortgages completed in the month, some 3.5 per cent more than in the same month a year earlier.

The £4.4bn of new lending in the month was 4.8 per cent more year-on-year, the figures showed.

The average first-time buyer is now borrowing 3.62 times their salary and getting 84.9 per cent of the purchase price of £167,000, UK Finance reported.

The average age of a first-time buyer is now 30 and he or she has a gross household income of £42,000.

Mike Scott, chief property analyst at estate agent Yopa, said that despite the slight increase in first-time buyer mortgage sizes, these mortgages are still relatively affordable.

He said: “The average first-time buyer now borrowing 3.62 times their salary and getting 84.9 per cent of the purchase price of £167,000.

“However, these mortgages are still quite affordable, with first-time buyers’ mortgage repayments averaging only 17.2 per cent of their household income, which is actually less than the 17.5 per cent average for all homemovers.

“The biggest obstacle remains the need to find £25,000 (on average) for the deposit.”

The picture on buy-to-let was more mixed.

Despite the strong growth in buy-to-let remortgages, which were up 32.4 per cent by number and 35.3 per cent by value than the same month the previous year, tax changes have prompted a slump in new lending.

There were 5,000 new buy-to-let house purchase mortgages completed in the month, some 5.7 per cent fewer than in the same month a year earlier.

By value this was £0.7bn of lending in the month, 12.5 per cent down year-on-year.

Mark Dyason, managing director of specialist property finance broker Thistle Finance, said: “We are seeing a particular surge in buy-to-let remortgages, especially among portfolio landlords.

“The fact that buy-to-let remortgages are up by a third compared to a year ago shows that those landlords still in the market are taking it seriously and still see a future in it.

Source: FT Adviser