Home buyer activity continues to build
Recent figures have indicated that the number of home buyers grew significantly during March.
According to the latest report from the Council of Mortgage Lenders (CML), the number of loans taken out rose by 27% since February, up to 61,700.
Reaching the highest monthly volumes for 2017 so far, March saw home mover and first-time buyer activity rise from its seasonal descent. Although home mover figures for March fell on a yearly basis by 12%, this month also saw the highest number of loans being advanced to first-time buyers in any corresponding month since 2007.
Looking at the figures on a quarterly basis, house purchase activity fell to its lowest point since Q1 of 2015. The number of remortgage loans advanced, in contrast, reached its highest point since Q1 of 2009.
Growing to £133,500, the typical size of a first-time buyer loan saw a slight increase in March, up from £132,000 in February. Monthly speaking, however, the average household income did not increase, remaining at £40,000, resulting in the income multiple rising from 3.54 to 3.53.
On average, the amount borrowed by UK home movers dropped on a monthly basis from £176,000 to £172,000. Similarly, there was also a monthly fall in the average household income of a home mover, dropping to £54,100 in March from £55,000 during February. These changes mean that the income multiple for home movers remains at 3.34.
Commenting on the figures was Paul Smee. The director general of the CML highlighted the need to acknowledge the impact of stamp duty on last years’ figures, as well as the expected continuation of the current trends.
“Comparing this March to last year is misleading because of the peak in activity before the stamp duty changes last Spring. Overall, lending trends have remained reasonably consistent. The relatively sluggish activity among home-movers stands in contrast to the growth in first-time buyer and remortgage activity, but in aggregate the market is showing broadly the levels of activity we expected. As we head into the summer, we expect a continuation of these trends, with both first-time buyer and remortgage lending expected to maintain momentum in the light of the very attractive deals currently available.”