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.

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First-time buyer growth continues in Wales in first quarter but home movers decline

Published: 24 May 2017

In the first quarter:

  • Home buyers borrowed £840m for house purchase, down 19% quarter-on-quarter and 1% year-on-year. They took out 6,500 loans, down 19% compared to the previous quarter and 2% on the first quarter 2016.
  • First-time buyers borrowed £380m, down 19% on the fourth quarter but up 15% on the first quarter last year. This totalled 3,400 loans, down 17% quarter-on-quarter but up 13% year-on-year. 
  • Home movers borrowed £450m, down 22% quarter-on-quarter and 15% compared to a year ago. This totalled 3,100 loans, down 21% quarter-on-quarter and 16% compared to the same quarter in 2016.
  • Remortgage activity totalled £510m, up 9% on the fourth quarter and 21% on the same quarter last year. This came to 4,500 loans, up 10% quarter-on-quarter and 18% compared to a year ago.

Julie Ann Haines, CML Cymru chair, commented:

The traditional seasonal dip in the winter months and last year's surge of home mover activity ahead of stamp duty changes distorts the lending picture slightly. Still, first-time buyers continue to be a key driver in Wales with the largest activity in the first quarter of the year since 2007, and remortgage activity is at a five-year quarterly height. The mix of government scheme support and low mortgage rates appear to be fueling this growth and we'd expect this momentum to continue into the summer months.

Affordability in Wales remains positive

First-time buyers affordability metrics in Wales remained better in the first quarter than for the UK overall. First-time buyers typically borrowed £106,300 (£133,000 in the UK overall), down from £107,200. The average household income was £33,000 (£40,000 in the UK overall), down from £33,400. The typical income multiple in Wales of 3.32 (from 3.29 the previous quarter) also compared favourably to the UK average of 3.53.

Affordability metrics for home movers saw the typical amount borrowed this quarter was £130,300 (£175,000 in the UK overall), down on £133,700 the previous quarter. The average household income of a home mover was £46,500 (£54,600 in the UK overall), down from £47,000. This meant the typical home mover income multiple in Wales was 2.91, compared to 2.95 the previous quarter and the UK average of 3.34.

Chart 1: Number of loans to home-owners, 2007-2017

20170522 Q1 2017 Wales MLT chart 1

Source: CML Regulated Mortgage Survey

Download data

Table 1: Number of loans for house purchase and remortgage in Wales

 

House purchase

Remortgage

 

FTBs

Movers

Home owners

Q1 2016

3,000 3,700 3,800

Q4 2016

4,100 3,900 4,100

Q1 2017

3,400

3,100 4,500

Change compared to Q4 2016

-17.1% -20.5% +9.8%

Change compared to Q1 2016

+13.3% -16.2% +18.4%

Table 2: Value of loans for house purchase and remortgage in Wales

 

House purchase (£m)

Remortgage (£m)

  FTBs Movers Home owners

Q1 2016

330 530 420

Q4 2016

470 580 470

Q1 2017

380 450 510

Change compared to Q4 2016

-19.1% -22.4% +8.5%

Change compared to Q1 2016

+15.2% -15.1% +21.4%

 20170522 Wales Q1 2017 FTBs affordability inforgraphic

 20170522 Wales Q1 2017 home movers affordability inforgraphic

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 97% 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 second quarter of 2017 will be released on Wednesday 23 August 2017.

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Gareth Hill

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