Lending to first time buyers increased in October, signalling that those who have yet to get on the property ladder are feeling much more optimistic about their finances, the director general of the Council of Mortgage Lenders (CML) has said.
According to independent.co.uk, figures from the CML reveal that in October, some 26,800 loans were advanced to first time buyers – 33 per cent higher than last year. The typical loan amount also reached the highest levels ever seen, with first time buyers requesting a mortgage worth £119,500 on average.
The number of loans issued in October totalled £3.7 billion – almost 50 per cent more than a year ago.
Howard Archer of IHS Global Insight commented that house prices are set to rise and could increase by as much as eight per cent within the next few months.
“While the strength of house price rises in London is a significant concern and pushing up the overall national increase in house prices, we are currently some way off from an overall housing market bubble emerging,” he said.
Due to the recent increase in property prices, the Bank of England has scrapped the Funding for Lending scheme, which helped keep mortgage rates low, reports cityam.com.