Third quarter figures for mortgage lending in Wales increased on the previous quarter but declined on the same period last year.
According to figures from the Council of Mortgage Lenders, there were 5,900 house purchase loans advanced in Wales in Q3, valued at £650 million.
Lending to borrowers buying a home in Wales grew slower than in the rest of the UK, where there was an increase of 16 per cent compared to the second quarter.
Remortgage lending fell a total of £300 million was advanced to borrowers remortgaging, down by 14 per cent compared to the second quarter and by 32 per cent compared to the third quarter last year. This represented a larger fall than in the UK overall where remortgage lending fell by 7 per cent compared to the previous quarter and 24 per cent compared to the third quarter last year.
Contributing to the increase in house purchase loans, the number of loans advanced to first-time buyers rose in the third quarter. In the last three months, 2,300 first-time buyers in Wales bought their first home. This represented a 10 per cent increase compared to the second quarter, but unchanged from the same period last year.
Lending to first-time buyers in Wales totaled £220 million in the third quarter, up from £200 million in the previous quarter.
On average, first-time buyers in Wales continued to put down a smaller deposit than in the UK overall. In the third quarter, the loan-to-value (LTV) ratio remained unchanged compared to the first two quarters of 2012, at 85 per cent. This compared favourably with the rest of the UK where first-time buyers typically borrowed 80 per cent of the property’s value.
Initial mortgage payments consumed 19.1 per cent of first-time buyer income in the third quarter in Wales, unchanged compared to the second quarter and lower than the 20.1 per cent in the UK overall.
Home movers in the third quarter accounted for a small increase compared to the previous quarter. A total of 3,600 loans were advanced to home movers, up by 3 per cent compared to the second quarter, but down by 5 per cent on the same period last year.
The LTV ratio for home movers in Wales, at 71 per cent, remained unchanged for the fourth consecutive quarter.
Peter Hughes, chair of CML Cymru, commented: “With the number of house purchase loans increasing and remortgage lending fading, the market in Wales has shown similar trends to the UK overall. The launch of a mortgage indemnity scheme earlier this month should help people to access higher loan-to-value mortgages from spring next year, but as with the Funding for Lending scheme, it will take some time before we can assess the full impact.”
Loading ...