Growing number of first-time buyers getting on housing ladder says UK Finance

An increasing number of first-time buyers are getting a foot on the property ladder, figures from a trade association show.

Some 36,200 new first-time buyer mortgages were completed in November 2018, 5.8% more than in the same month a year earlier, UK Finance said.

The average first-time buyer is aged 30 and puts down a 15% deposit on a home.

The number of mortgages being handed out to home movers also crept up, by 1.1% year-on-year, with 36,200 loans completed.

Meanwhile, home owner re-mortgaging levels steadied, with 39,600 new home owner re-mortgages completed, 1.3% more than in the same month a year earlier.

In the buy-to-let sector, the number of loans being handed out for landlords to purchase properties in November was down year-on-year, but re-mortgaging increased annually.

Some 6,100 new buy-to-let home purchase mortgages were completed, 9% down on November 2017.

And 15,000 new buy-to-let re-mortgages were completed, 9.5% more than the same month a year earlier.

Jackie Bennett, director of mortgages at UK Finance said: “A mixture of competitive deals and schemes including Help to Buy saw even more first-time buyers get a foot on the housing ladder during November.

“Meanwhile, home owner re-mortgaging activity has steadied, after reaching its highest level in a decade the previous month as a large number of fixed-rate deals came to an end.

“In the buy-to-let market new home purchases remain subdued, while re-mortgaging continues to grow as landlords lock into attractive rates.”

The Royal Institution of Chartered Surveyors (Rics) said this week that surveyors’ expectations for house sales in the next few months are the most negative seen for 20 years.

Rics said that as well as Brexit uncertainty, domestic issues related to lack of supply and affordability continue to affect the market.

Jonathan Harris, director of mortgage broker Anderson Harris, said it is “encouraging” to see that first-time buyers numbers are holding up.

He said: “Lenders have been tempting them with attractive rates at high loan-to-values, while Government incentives, such as Help to Buy and stamp duty exemptions, are also playing a part.

“First-time buyers have also benefited from the lack of competition for smaller homes from landlords, with many investors giving buy-to-let a wide berth.”

Mr Harris said there are “deals to be done”.

He said: “Some buyers are of the view that the Brexit uncertainty means that sellers will take an offer that they might not have accepted a while ago, so for those who are cash buyers, chain-free or simply have their funding lined up, there are some buying opportunities out there.

“Buy-to-let remains subdued although landlords are cannily re-mortgaging and cutting costs where they can.

“Mortgage rates are still competitive, with some tempting rates for borrowers in both the residential and buy-to-let space.”

Jeremy Leaf, a north London estate agent and a former Rics residential chairman, said first-time buyers are “dipping their toes in the water”.

He said: “There is much talk about Brexit but we find that it remains a largely London/South East preoccupation among home buyers.

“Elsewhere, affordability is just as important when it comes to buyers and sellers making home moving decisions.”

He said activity is likely to remain subdued before and immediately after Brexit.