First-time buyers ‘at six-year peak’

The number of people taking their first step on to the housing ladder set another six-year high in October, mortgage lenders have reported.

Some 26,800 loans, worth £3.7bn, were issued to first-time buyers in the month, an increase of 16 per cent on the previous month and a 48 per cent rise on a year ago, the Council of Mortgage Lenders (CML) said. Their typical loan size was a record £119,500, although the average income of such households also reached an all-time high of £36,460.

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The findings cover the month in which major lenders started taking mortgage applications from people with five per cent deposits under the new phase of the Government’s Help to Buy scheme.

The CML said the downward drift in mortgage interest rates ensured monthly repayments remained affordable for first-time buyers. Their typical repayment is now 19.3 per cent of gross income, close to the lowest recorded figure since 2005 of 19.1 per cent in April.

The CML figures also showed that 60,800 mortgage deals worth £9.7bn were advanced for house purchases in October.