Mortgages to buyers of first homes surge to nearly £6bn

HOME loans to first-time buyers surged by more than a quarter in June during a ‘busy month’ for the mortgage market. UK Finance, the trade association

HOME loans to first-time buyers surged by more than a quarter in June during a ‘busy month’ for the mortgage market.

UK Finance, the trade association for banks and building societies, said new homeowners borrowed £5.9billion, up 26 per cent on May. Their borrowings were also up nine per cent on June 2016.

Despite the upswing, there were signs the housing market would soften during the rest of the year, UK Finance said.

The average loan taken out by first-time buyers in June was £139,000 compared with £137,000 in May.

Separate house price figures released by the Office for National Statistics, the Land Registry and other bodies showed first-time buyers paid an average £188,947, a 4.9 per cent increase on a year before.

Those already on the property ladder borrowed £7.8billion in June, also up 26 per cent on May, and 15 per cent more than a year earlier. Buy-to-let lending totalled £3billion, up three per cent on May and three per cent more than June 2016.

Paul Smee, head of mortgages at UK Finance, said: ‘June’s figures show a busy month, with home-movers having their highest monthly activity levels for over a year and an especially high number of loans for first-time buyers.

‘But there are signs of a softening market and we are not anticipating that this will be sustained in the second half of 2017.’

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