Mortgages becoming more affordable for first time buyers, reports London Mortgage Brokers Friday, 9th December 2011

According to the CML and as low interest rates continue to persist, monthly mortgage payments for first-time buyers are at their most affordable level for nearly eight years.

With monthly mortgage payments taking up an average of 9.2% of their income, affordability for home movers alsois at its lowest level since CML records began in 2002.

Down 1% year-on-year, however, loans to first-time buyers dropped 10% in October to 16,400 compared to the previous month.

As with first-time buyers, home mover loans dropped by 7% to 28,000, down 8% in value to £4.5bn compared to September. Year-on-year, numbers were down 8% and 6% in value.


Down 5% in number and 4% in value year-on-year, house purchase loans dropped 8% in number and value in October to 44,500 loans worth £6.5bn.

When it comes to remortgages, loans slumped 15% in October to 28,900 compared to 34,200 loans in September, but were down just 1% on the same period of 2010. The value of remortgage loans was down 16% to £3.6bn.

"Despite the fall in lending in October, it is possible that we will see signs of increased activity by first-time buyers in the early months of next year, as we approach the end of the government's Stamp Duty concession at the end of March.
"The underlying picture of the market overall, however, is level, albeit at low levels of lending activity." Paul Smee, director general of the CML, said.