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  4. Northern Ireland house purchase lending up 26% year-on-year in the first quarter of 2016

Northern Ireland house purchase lending up 26% year-on-year in the first quarter of 2016

Published: 25 May 2016

On an unadjusted basis:

  • Home-owners borrowed £340m for house purchase, down 13% quarter-on-quarter but up 26% year-on-year. They took out 3,200 loans, down 14% on the previous quarter but up 14% compared to the first quarter 2015.
  • First-time buyers borrowed £160m, down 16% on the fourth quarter 2015 but up 14% on the first quarter last year. This totalled 1,700 loans, down 19% quarter-on-quarter but up 6% year-on-year. 
  • Home movers borrowed £180m, down 5% quarter-on-quarter but up 29% compared to a year ago. This totalled 1,400 loans,  down 13% quarter-on-quarter but up 17% compared to the same quarter in 2015.
  • Remortgage activity totalled £170m, down 11% on the fourth quarter 2015 but up 6% compared to a year ago. This came to 1,600 loans, down 11% quarter-on-quarter but unchanged compared to a year ago.

Derek Wilson, CML Northern Ireland chair, commented:

Lending in the beginning of the year is traditionally muted due to seasonal factors, as seen in the UK overall, but the year-on-year increases in first-time buyers and home movers are encouraging. This is the best performing first quarter of the year in Northern Ireland for house purchase lending since 2007, and remortgage levels have also stayed at a consistent level the past few quarters. As with the rest of the UK, we are forecasting a gradual upward trend in lending in 2016 and 2017.

Yesterday in a News & Views feature, CML Northern Ireland chairman Derek Wilson analysed the Northern Ireland housing market in more detail exploring how the  market is recovering in the country heavily affected by the financial crisis.

Northern Ireland house purchase and remortgage lending in the first quarter

While seasonal factors traditionally cause activity to be lower in the first quarter of the year, home-owner house purchase activity was at its highest level for the first period of the year since 2007.  

Affordability metrics for first-time buyers in Northern Ireland remained better than for the UK overall. The amount borrowed this quarter compared to the previous was £90,000 (£130,500 in the UK overall) from £86,710 and the average household income of a first-time buyers was £31,327 (£40,000 in the UK overall) from £30,434 meaning income multiple in Northern Ireland was 2.86 compared to 2.80 the previous quarter and the UK average of 3.46.

Affordability metrics for home movers show a similar trend. The amount borrowed this quarter compared to the previous was £113,245 (£172,295 in the UK overall) from £108,495 and the average household income of a home mover was £46,958 (£56,104 in the UK overall) from £45,938 meaning income multiple in Northern Ireland was 2.49 compared to 2.41 the previous quarter and the UK average of 3.20.

Chart 1: Number of loans to home-owners, 2007-2016

 20160525 NI Q1 2016 MLT press release chart one

Source: CML Regulated Mortgage Survey   

Download data

Table 1: Number of loans for house purchase and remortgage

 

House purchase

Remortgage

 

FTBs

Movers

Home owners

Q1 2015

1,600

1,200

1,600

Q4 2015

2,100

1,600

1,800

Q1 2016

1,700

1,400

1,600

Change compared to Q4 2015

-19.0%

-12.5.0%

-11.1%

Change compared to Q1 2015

+6.3%

+16.7%

Unchanged

Table 2: Value of loans for house purchase and remortgage

 

House purchase (£m)

Remortgage (£m)

  FTBs Movers Home owners

Q1 2015

140 140 160

Q4 2015

190 190 190

Q1 2016

160 180 170

Change compared to Q4 2015

-15.8% -5.3% -10.5%

Change compared to Q1 2015

+14.3% +28.6% +6.3%

20160525 Northern Ireland Q1 2016 FTBs affordability infographic

20160525 Northern Ireland Q1 2016 home movers affordability infographic

 

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 95% of all residential mortgage lending in the UK. There are 11.1 million mortgages in the UK, with loans worth over £1.3 trillion.

2. Source: CML Regulated Mortgage Survey for all home-owner mortgage data.

3. The Council of Mortgage Lenders does not publish statistics for mortgage approvals. The data in our monthly Regulated Mortgage Survey and gross lending press releases relate to mortgage advances only. A mortgage approval is the firm offer to a customer of a specific amount of credit secured against a particular property. A mortgage advance is the total amount of loan actually provided to the buyer, by the lender. Please see the mortgage statistics timeline on our website for further information.

4. The second quarter data will be released on Wednesday 24 August 2016.

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