The latest data from the Council of Mortgage Lenders (CML) reveals that that there were about 55,300 loans advanced for residential property purchases in August collectively worth in the region of £8.4bn, representing an 11 per cent rise year-on-year, and the largest volume of home loans seen since July 2010.
Lending to first-time buyers is up by a fifth on a year ago with £2.8 billion worth of loans advanced, only just below the levels witnessed in March when the ending of a stamp duty concession for this sector prompted a rush of people looking to complete deals. The typical first-time buyer deposit has stood at 19 per cent since July, the lowest average deposit for this sector in more than three years, the CML said.
Paul Hunt, managing director of Phoebus Software, said: "There are signs that the wind is changing, with more home loans being advanced in August than has been recorded in any single month for the last two years. Lenders' efforts to bolster first time buyer activity are clearly having an effect, with more competitive mortgage rates and higher loan to values resulting in a significant jump in first time buyers' loans since last month and compared to this time last year. I'm hopeful that these efforts will be bolstered further by the Government's Funding for Lending and New Buy programmes over the next few months. Mortgage availability has been rising since an £80 billion funding for lending scheme was launched at the start of August, although much of this has so far been concentrated around people with larger deposits of at least 20 per cent."
Jonathan Harris, director of mortgage broker Anderson Harris, said the figures showed "welcome indications" that funding for lending is starting to kick in, with several lenders slashing their rates recently.
This increase in mortgage lending follows on the RICS statement in the last 10 days anticipating a strong finish to 2012 in the property market.
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