From 1st July the Council of Mortgage Lenders is integrated into a new trade association, UK Finance. For the time being, all UKF mortgage information will continue to be published on this website, and UKF member-only mortgage information will only be available here.

UK Finance represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation takes on most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association. Please go to www.ukfinance.org.uk for wider content and updates from UK Finance.

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First-time buyers in Scotland up 16% in the third quarter

Published: 25 November 2015

New CML data on the characteristics of lending in Scotland in the third quarter of 2015 outlining mortgage lending to first-time buyers, home movers and remortagors.

Lending in the third quarter 2015:

  • There were 8,500 first-time buyer loans in Scotland - 4% up on the previous quarter and 16% up on Q3 2014. First-time buyers in the period borrowed £920 million - up 2% on the previous quarter and 16% on Q3 2014. 
  • At 10,000 loans, there were 12% more home-mover loans in the third quarter than the second, and 15% more than in Q3 2014. The value of home-mover lending was £1.5 billion, up 16% on the second quarter and 17% up on the third quarter 2014.
  • Remortgage lending went up in value quarter-on-quarter and year-on-year. 

Linda Docherty, CML chair for Scotland, commented:

The past two quarters have seen the highest level of borrowers purchasing their home in Scotland since 2007. Activity has remained robust over the past six months, with a surge in both first-time buyers and home movers, and with an economic  climate of low interest rates, increased earnings and competitive mortgage offers we would expect this to continue as we head towards the new year.

Chart 1: Loans for home-owner house purchase and for remortgage by value

 20151125 Scotland Q3 2015 Chart 1

Source: CML Regulated Mortgage Survey (April 2005 onwards), CML Economics      

Download the data 

Chart 2: Number of loans for house purchase and proportion of FTBs and home-movers

 20151125 Scotland Q3 2015 Chart 2

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Download the data

Table 1: Third quarter lending for home-owner house purchase and remortgage

  Number of house purchase loans % change Value of house purchase loans, £m % change Number of remortgage loans % change Value of remortgage loans, £m % change
Third quarter 2015 18,500   2,400   6,800   820  
Second quarter 2015 17,100 +8.2% 2,180 +10% 6,800 0% 780 +5.1%
Third quarter 2014 16,000 +15.6% 2,060 +16.5% 5,900 +15.3% 820 +26.2%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Lending for house purchase and remortgage  

House purchase lending in Scotland saw a quarter-on-quarter rise, by volume and by value, compared to the second quarter of 2015. This was the highest amount borrowed and the highest number of loans in a quarter since the fourth quarter of 2007.

The breakdown in house purchase lending in Scotland remains relatively evenly split, with first-time buyers accounting for 46% and home movers 54% of all house purchase activity.  

Remortgage lending by volume remained the same quarter-on-quarter but was up on the same quarter last year. The amount borrowed also increased on the previous quarter and the same quarter last year.

Table 2: Third quarter first-time buyer lending and affordability measures

 

Number of loans

% change

Value of loans £m

% change

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of   income

Third 
quarter
2015

8,500

 

920

 

99,275

33,242

83.7%

3.02

9.4%

17.2%

Second 
quarter
2015

8,200

+3.7%

900

+2.2%

101,500

34,000

83.3%

3.02

9.8%

17.2%

Third 
quarter
2014

7,300

+16.4%

790

+16.5%

98,600

32,520

83.0%

2.94

10.5%

17.3%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Lending to first-time buyers

First-time buyers in Scotland typically borrowed 3.02 times their gross household income, unchanged from the previous quarter but up on quarter three last year. It is still lower than the UK average of 3.44.

The typical loan size for first-time buyers was £99,275 in the third quarter, down from £101,500 in the second quarter. The typical gross income of a first-time buyer household was £33,242 also down compared to £34,000 in the second quarter.

First-time buyers' payment burden in the third quarter was 17.2% of gross income to cover capital and interest payments, unchanged on the second quarter but lower than the 18.1% UK average.

Table 3: Third quarter home mover lending and affordability measures

 

Number of loans

 

Value of loans £m

 

Loan size (£)

Income (£)

Loan-to-value

Loan-to-income

Interest payment as % of income

Capital and interest payment as % of   income

Third 
quarter
2015

10,000 

 

1,480

 

135,000

51,372

75.4%

2.70

6.9%

16.4%

Second quarter 
2015

 8,900

+12.4%

1,280

+15.6%

133,000

50,787

75.3%

2.70

7.2%

16.4%

Third
quarter 
2014

8,700

+14.9%

1,270

+16.5%

130,000

50,962

74.5%

2.62

8.0%

16.9%

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Lending to home movers

Home movers in Scotland typically borrowed 2.70 times their gross household income, unchanged from the previous quarter but less than the UK average of 3.14.

The typical loan size for home movers was £135,000 in the third quarter, up from £133,000 the previous quarter and lower than the £167,400 UK average. The typical gross income of a home movers' household was £51,372, up compared to £50,787 in the second quarter.

Home movers' payment burden in the third quarter saw them spend 16.4% of their gross household income to cover capital and interest payments, unchanged from the second quarter but lower than the 18.1% UK average.

Chart 3: Number of home-owner remortgages

 20151125 Scotland Q3 2015 Chart 3

Source: CML Regulated Mortgage Survey (April 2005 onwards)

Download the data

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

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. Data for the fourth quarter of 2015 will be released on Wednesday 24 February 2015.

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