Mortgage lending has risen by a whopping 41% in London over the past year, new figures show.
According to the Council of Mortgage Lenders, home buyers in London borrowed £7.1 billion for house purchase in the first quarter of 2016, up 6% quarter-on-quarter.
They took out 21,400 loans, down 2% on the previous quarter but up 20% compared to the first quarter of 2015.
The amount first-time buyers borrowed fell 7% to £2.9 billion on the previous quarter, but was up 19% on last year. This was the equivalent of 10,700 loans, a drop of 10% quarter-on-quarter but up 3% for the year.
The amount first-time buyers borrowed went up from £243,746 to £248,047, but this was offset by a rise in the total household income of borrowers to £62,508 from £61,155.
Home movers borrowed £4.2 billion, up 18% quarter-on-quarter and 63% compared to a year ago. This equated to 10,600 loans.
Remortgage activity rose 36% over the past year to £4 billion, the highest first quarter figure since 2009.
Paul Smee, director general of the CML, said: “The usual seasonal dip in lending in the first quarter of the year didn’t seem to impact London as strongly as the UK overall, mainly due to a strong uptick in home mover activity. Remortgage lending also performed well resulting in the highest first quarter remortgage levels in the capital since 2009.
“The housing market in Greater London has some unique characteristics compared to the rest of the UK – more first-time buyers, but lower overall levels of home-ownership. Affordability and the supply of housing remain critical factors for the London market, and we will be pleased to work with the new mayor and his deputy on how to deliver appropriate strategy over his term of office.”
