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New mortgage data for the third quarter in 2018 revealing some positive trends across different regions of the UK, has been released by UK Finance.

London saw the highest level of first-time buyers since 2015 with a recorded 11,700 new first-time buyer mortgages that were completed in the capital during the third quarter of 2018, which is an increase of 2.6 per cent since on the same period in 2017.

The national mortgage market remained steady in Wales during the third quarter of 2018, although the levels of completed first-time buyer mortgages were 2.3 per cent lower when compared to the same period in 2017. However, there were 4,900 new homeowner remortgages completed in Wales in the third quarter of 2018, which was an increase of 2.1 per cent compared to 2017.

Propp – MPU

Scotland saw a sharp increase in the number of homeowner remortgages that were completed in the third quarter of 2018. This is a 13.6 per cent increase when compared to figures for the same period in 2017.

And in Northern Ireland, new data was released for the second quarter of 2018 which showed that the number of new first-time buyer mortgages that were completed was 2,700, which is a 12.5 per cent increase when compared to the same period in 2017. This is the highest quarterly level recorded since 2005.

This new data helps to show that despite the growing economic uncertainty caused by Brexit, which has been felt in other areas of the UK property market; there are still large numbers of people applying for new mortgages, whether they are first-time buyers, homemovers or homeowners looking to remortgage their property.

London’s first-time buyers on the rise

The UK Finance data for London as a region has shown that there was a 2.6 per cent increase in the number of new first-time buyer mortgages completed in the third quarter of 2018, totalling 11,700. This is the highest level recorded over the past three years.

The average age of a first-time buyer in London was recorded at 32, with a gross household income of £70,000.

This new data suggests that first-time buyers in the region are likely benefitting from the slowing of house prices in the London property market. Recent UK property value data from Savills’s showed that there was a slowdown in London’s house price values, after witnessing a 72 per cent increase since 2008.

There were 8,100 new homemover mortgages completed in London during the third quarter of 2018, which is a 4.7 per cent decrease when compared to the same period in 2017. However, the total amount of new lending came to £3.49 billion during the third quarter this year which was 0.3 per cent higher than in 2017.

Jackie Bennett, Director of Mortgages at UK Finance, commented on the data: “London’s mortgage market remained resilient in the third quarter of this year, despite an uncertain economic environment. The number of first-time buyers in the capital reached its highest level in three years, boosted by schemes such as Help to Buy. The recent extension of the scheme until 2023 will help even more people get a foot on the housing ladder in the years ahead.”

Welsh mortgage market remains steady

A closer look at UK Finance’s mortgage data for the third quarter this year in Wales, reveals there was an increase of 3 per cent in the year-on-year amount of lending to new homemover mortgage borrowers totalling £0.68 billion. There were also 4,300 new homemover mortgages that were completed in Wales during this period, which remained the same when comparing data for the third quarter in 2017.

However, the number of completed first-time buyer mortgages in Wales saw a slight dip of 2.3 per cent when compared to the third quarter in 2017. The total amount of new mortgage lending for this group totalled £0.52 billion, which remained consistent year-on-year. The average first-time buyer in Wales was recorded at 29 years of age with a gross household income of £35,000.

Julie-Ann Haines, chair of UK Finance’s Wales Mortgage Committee, commented on the data: “The Welsh mortgage market has remained steady, with overall house purchases broadly in line with the same period last year. Remortgaging has continued to grow as many existing loans mature and homeowners take advantage of a competitive market to lock into attractive deals.”

“The number of first-time buyers is down slightly amid ongoing economic uncertainty, while the buy-to-let market has also softened due to the impact of recent tax changes. However, the overall picture of the market is consistent with the last couple of years and it would appear that this trend is set to continue in the short term.”

Scotland – rise in the levels of homeowner remortgages

The key highlights from the UK Finance mortgage data for Scotland during the third quarter of 2018 revealed that there were 9,200 new homeowner remortgages completed in Scotland, which is up 13.6 per cent when compared to the same period in 2017. The total amount of remortgage lending rose by 18 per cent compared to last year to reach £1.1 billion.

Elsewhere, there were 5.3 per cent less new first-time buyer mortgages completed in Scotland during the same period this year totalling 8,900, and lending was down 1 per cent year-on-year to £1.04 billion. Data also showed that the average Scottish first-time buyer is 29 years of age with a gross household income of £35,000.

Douglas Cochrane, Chair of UK Finance’s Scotland Mortgage Committee, commented on the data: “Scotland saw strong growth in remortgaging activity this quarter, as many fixed rate loans came to an end and customers continue to shop around for attractive deals. The number of first-time buyers has softened slightly compared to the same quarter last year while homeowner purchases remain steady.”

Northern Ireland – the UK region with the largest growth of house purchases

In Northern Ireland, according to the UK Finance data, when comparing mortgage trends across the UK for the second quarter of 2018, the region saw the highest growth in house purchase activity compared to any other region.

New first-time buyer mortgages increased in the second quarter of 2018 by 12.5 per cent, totalling 2,700 when compared to the same period in 2017, and this was the highest quarterly level recorded in Northern Ireland since 2005. The total amount of new lending reached £0.28 billion which was 16.7 per cent higher year-on-year and the average first-time buyer in Northern Ireland was recorded as 30 with a gross household income of £33,000.

There were also 1,600 new homemover mortgages completed in the second quarter of 2018, which rose by 6.7 per cent when compared to the same quarter in 2017. This amounted to a 10.5 per cent year-on-year increase in new lending which totalled £0.21 billion. The data also revealed that the average homemover in Northern Ireland is aged 39 with a gross household income of £46,000.

Northern Ireland also saw a 9.5 per cent increase in the number of homeowner remortgages for the second quarter of 2018, compared to 2017, as 2,300 new homeowner remortgages were completed. The total figure of remortgage lending came to £0.25 billion, which is a 13.6 per cent increase year-on-year.

Derek Wilson, chair of UK Finance’s Northern Ireland Mortgage Committee commented: “The Northern Ireland mortgage market continues to perform strongly and has returned to the levels of consistent growth last seen in the early 2000. Lending to first-time buyers has overtaken remortgaging as the largest sector by value, reserving the position in the last quarter, as borrowers take advantage of what remains the UK’s most affordable region.”

“With the number of first-time buyers reaching a 12 year high, it will be important to increase the supply of new build homes to match this growing demand.”

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Steven Taylor
Steven reports on the daily churn of the property news cycle, often reporting on the stories you may have missed during the week. He covers a range of topics, including market sentiment, new findings and announcements by policy-makers.

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