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| First-time buyer numbers at six-year high | First-time buyer numbers at six-year high |
| (17 days later) | |
| The number of first-time buyers rose to its highest level since 2007 in May, according to the Council of Mortgage Lenders, after banks and building societies became more willing to offer loans to borrowers with small deposits. | The number of first-time buyers rose to its highest level since 2007 in May, according to the Council of Mortgage Lenders, after banks and building societies became more willing to offer loans to borrowers with small deposits. |
| A total of 25,100 loans were granted to newcomers to the property market during the month, a 29% increase on April's figure and up by 42% on May 2012, the CML said. | A total of 25,100 loans were granted to newcomers to the property market during the month, a 29% increase on April's figure and up by 42% on May 2012, the CML said. |
| It was the highest monthly figure recorded since November 2007, shortly after the property market peaked and house prices started to fall, and a marked contrast to the 8,500 loans granted in January 2009. | It was the highest monthly figure recorded since November 2007, shortly after the property market peaked and house prices started to fall, and a marked contrast to the 8,500 loans granted in January 2009. |
| The value of borrowing by first-time buyers was also at its highest level for more than five-and-a-half years, and up by 54.5% on May 2012, at £3.4bn, and the CML said individuals were also typically borrowing more. The average loan size was £113,400 in May compared with £110,000 in April and £105,000 a year previously. | The value of borrowing by first-time buyers was also at its highest level for more than five-and-a-half years, and up by 54.5% on May 2012, at £3.4bn, and the CML said individuals were also typically borrowing more. The average loan size was £113,400 in May compared with £110,000 in April and £105,000 a year previously. |
| The figures, which are the latest in a series of signs that the housing market is recovering, include some transactions made through the first part of the government's Help to Buy scheme. | The figures, which are the latest in a series of signs that the housing market is recovering, include some transactions made through the first part of the government's Help to Buy scheme. |
| It launched in April and offers equity loans to buyers with small deposits who want to purchase new-build properties up to the value of £600,000. The government said the scheme had been "an instant hit", with almost 7,000 reservations supported by it in its first three months, and more than 1,000 sales completed. | It launched in April and offers equity loans to buyers with small deposits who want to purchase new-build properties up to the value of £600,000. The government said the scheme had been "an instant hit", with almost 7,000 reservations supported by it in its first three months, and more than 1,000 sales completed. |
| However, the CML said a bigger factor behind the growth was the return to higher loan-to-value (LTV) lending, fuelled in part by the government's Funding for Lending scheme. This was designed to encourage banks and building societies to offer mortgages again after the credit crunch saw them crack down on high LTV loans. | However, the CML said a bigger factor behind the growth was the return to higher loan-to-value (LTV) lending, fuelled in part by the government's Funding for Lending scheme. This was designed to encourage banks and building societies to offer mortgages again after the credit crunch saw them crack down on high LTV loans. |
| The CML said that for some months there had been increases in LTVs, and that in May the average first-time buyer LTV rose to 83%, up from 81% in April and the highest ratio since November 2008. | The CML said that for some months there had been increases in LTVs, and that in May the average first-time buyer LTV rose to 83%, up from 81% in April and the highest ratio since November 2008. |
| Separate figures from chartered surveyors e.surv tell a similar story: it said the number of borrowers with deposits of less than 15% was up by 47% year-on-year in June, reaching its highest level since the financial crisis. | Separate figures from chartered surveyors e.surv tell a similar story: it said the number of borrowers with deposits of less than 15% was up by 47% year-on-year in June, reaching its highest level since the financial crisis. |
| A total of 55,900 house purchase loans were granted in May, the CML said – a 31% increase on April. The number of mortgages taken out by movers rose to 30,700, while the value of those loans increased to £5.1bn. | A total of 55,900 house purchase loans were granted in May, the CML said – a 31% increase on April. The number of mortgages taken out by movers rose to 30,700, while the value of those loans increased to £5.1bn. |
| Paul Smee, the director general of the Council of Mortgage Lenders, said: "Although monthly lending is still running at far less than half its typical monthly level during the peak, there is no doubt that the mortgage market is firmly open for business. | Paul Smee, the director general of the Council of Mortgage Lenders, said: "Although monthly lending is still running at far less than half its typical monthly level during the peak, there is no doubt that the mortgage market is firmly open for business. |
| "Both the borrowing appetite of first-time buyers, and the availability of attractive mortgages for them, have improved markedly since a year ago." | "Both the borrowing appetite of first-time buyers, and the availability of attractive mortgages for them, have improved markedly since a year ago." |
| He added: "It is important that the supply of housing steps up, as increased housing supply is a crucial factor in ensuring that housing is affordable over the long term." | He added: "It is important that the supply of housing steps up, as increased housing supply is a crucial factor in ensuring that housing is affordable over the long term." |
| Richard Sexton, director of e.surv, said the first-time buyer market was "alive and kicking again" and confidence was returning to the housing market. | Richard Sexton, director of e.surv, said the first-time buyer market was "alive and kicking again" and confidence was returning to the housing market. |
| However, he added: "The improvement in high LTV lending is relative. It is still well short of pre-2008 levels, which is why there are still comparatively few first-time buyers. Homeownership remains a dream for the majority of young people, but it is a distant one for most of them." | However, he added: "The improvement in high LTV lending is relative. It is still well short of pre-2008 levels, which is why there are still comparatively few first-time buyers. Homeownership remains a dream for the majority of young people, but it is a distant one for most of them." |
| Details of the second part of the Help to Buy scheme, which will help buyers with small deposits to buy both new build and existing homes by offering lenders a government guarantee, are expected to be announced in the next fortnight. | Details of the second part of the Help to Buy scheme, which will help buyers with small deposits to buy both new build and existing homes by offering lenders a government guarantee, are expected to be announced in the next fortnight. |
| News that lenders are opening their doors to borrowers with small deposits will be welcome to those struggling to build enough savings to get on the housing ladder at a time when prices in some areas of the country have started rising again. | News that lenders are opening their doors to borrowers with small deposits will be welcome to those struggling to build enough savings to get on the housing ladder at a time when prices in some areas of the country have started rising again. |
| However, surveyors have reported a fall in the supply of properties for sale in June, which could restrict activity over the coming months. | However, surveyors have reported a fall in the supply of properties for sale in June, which could restrict activity over the coming months. |
| Top mortgages | Top mortgages |
| HSBC | |
| Chelsea Building Society | Chelsea Building Society |
| HSBC | HSBC |
| Provided by London & Country for the Guardian | Provided by London & Country for the Guardian |