First-time buys up to five year high in London

 
Ben Southwood
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FIRST-TIMERS rushed back to the London housing market in 2012, with first-time sales up to their highest since 2007.

London housing transactions involving first-time buyers rocketed up 15 per cent between 2011 and 2012, from 32,400 to 37,300, according to Council of Mortgage Lenders (CML) figures out yesterday.

And the figure continued to rise through to the end of the year, with the fourth quarter enjoying a four per cent rise in sales to first-time buyers, the CML said, as part of a 17 per cent gain over the same period the year before.

Lending also climbed over the year. The total number of house purchase loans was up 9.9 per cent to 74,600 last year, another five year high, despite a small quarterly fall in the final three months of the year. Together these loans extended £17.8bn of credit to borrowers, up from the £16.3bn lent in 2011.

“These figures show that first-time buyers in London are regaining their confidence and returning to the market,” said CML boss Paul Smee.

“Even though property in London remains more expensive than in the rest of the UK, low interest rates and the increased availability of high loan-to-value mortgages for borrowers with smaller deposits has enabled more aspirational homeowners to enter the market than at any time in the last five years,” Smee added.

Remortgage lending was the only weak spot in the market, the CML said, falling to £8.4bn, down three per cent compared to 2011.