There were 37 per cent more first-time buyers taking out home loans in December of 2013 than in the same month the previous year, the latest figures from the Council of Mortgage Lenders (CML) have found.
Lending to home owners was also up, increasing by 19 per cent in December last, compared to the same month in 2012, while remortgage lending followed the trend for year-on-year increases, up 13 per cent in that timeframe.
Buy-to-let lending, however, saw a decrease, of 10 per cent both year-on-year and between November and December 2013.
The Bank of England reported earlier this month that UK gross mortgage lending was £16.8 billion in December, which due to the expected seasonal dip was down slightly by 1 per cent but up 49 per cent compared to December 2012.
In the fourth quarter of 2013, gross UK mortgage lending totaled £51.4 billion which was an increase of 36 per cent compared to the fourth quarter of 2012.
Commenting on the data, CML director general Paul Smee said: “In 2013 there has been a resurgence in the mortgage market with year-on-year growth for all types of borrower. First-time buyers were an especially important factor in driving the market forward in 2013 as improved economic conditions, as well as the introduction of government schemes like Help to Buy, have given the opportunity for them to enter the market and become home-owners.”
“The consistent upward lending trend seen throughout 2013 would suggest relative optimism going forward. But there are challenges ahead, not least in implementing the Mortgage Market Review regulation in April and in ensuring that there is no suggestion of a property bubble; and all this will be key to determining how the market will perform in 2014.”
Ashley Brown, managing director, independent mortgage broker and financial advisers Moneysprite, comments: “This latest data demonstrates very clearly the momentum the mortgage market gained during 2013, especially among first time buyers.
“37 per cent year-on-year growth in first time buyer lending in December is nothing short of a transformation.
“The implementation of the Mortgage Market Review may well have an impact on loan levels but we expect any effects to be only temporary.
“2014 has started very strongly and, at the current growth rate, will almost certainly finish up on 2013.”
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