The number of mortgages handed out to first-time buyers across the UK has surpassed 30,000 in one month for the first time since 2007, new figures from banks and building societies reveal.
The Council of Mortgage Lenders (CML) said yesterday that 30,200 home loans worth £4.6 billion were advanced to people taking their first step on the property ladder in July.
The last time the number of first-time buyer loans topped the 30,000 mark was in August 2007, when 35,300 loans were handed out, according to data on its website.
The average size of a first-time buyer loan also increased to a new all-time high of £127,500 in July, up from £123,750 in June.
First-time buyers are typically paying 19.6 per cent of their gross income on their mortgage repayments, which is still significantly less than a recent peak of 24.8 per cent in December 2007.
The current low interest rate environment is helping to keep people’s borrowing costs down, but home owners have been warned to start thinking now about how they will cope with the prospect of higher payments when the Bank of England base rate eventually starts to move off its historic 0.5 per cent low.
The number of home loans handed out to first-time buyers in one month dropped as low as 8,500 in January 2009 as the financial downturn took hold and low-deposit mortgages became harder to come by.
Paul Smee, director general of the CML, said general economic improvements across the UK have helped to allow more people to enter the property market.