Highest number of mortgages in 2016 for first-time buyers in almost a decade

More mortgages were handed out to first-time buyers during 2016 than in any other year since 2007, figures from banks and building societies show.

The Council of Mortgage Lenders (CML) said a total of 338,900 loans were handed out across the UK last year to people taking their first step on the property ladder - the highest figure since 2007 when 359,900 loans were advanced.

In total, first-time buyers borrowed £53.2 billion last year.

This was the highest annual total for this sector since the CML's records started in 1974, surpassing a peak of £48.6 billion in 2006.

Rising house prices mean those aspiring to become home owners have had to borrow more or dig deeper into their own pockets to get on the property ladder.

Separate figures released by the Office for National Statistics (ONS) show a first-time buyer in Britain faces paying 7% more for a home than a year earlier.

The average price paid by a first-time buyer for a property is now £184,973.

Despite rising house prices, ultra-low interest rates have kept borrowers' mortgage repayments relatively affordable.

The CML's figures show the average first-time buyer put down a deposit of 18.1% in December and 17.4% of their household income went on mortgage repayments.

In December 2015, 18.2% of a first-time buyer households' income was going on their mortgage repayments on average.

The CML's figures also show home movers took out 360,300 loans last year for house purchase, down 2% on 2015.

However, re-mortgaging by home owners surged last year, as households took advantage of the low mortgage rates available.

Some £66.2 billion-worth of re-mortgage loans were handed out to home owners, jumping by 20% year-on-year.

Meanwhile, 102,100 loans were handed out for buy-to-let house purchases last year, down on the 117,500 loans advanced for this purpose in 2015.

A stamp duty hike for buy-to-let investors was imposed last April, prompting some landlords to bring forward their purchases ahead of the deadline.

Paul Smee, director general of the CML, said the mortgage market has remained "resilient and adaptable" and lending volumes are expected to remain similar this year to those seen in 2016.