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First time buyers are a boost to London mortgage market

New purchase numbers in London have been improved by first time buyers increasing 1.2% compared to a year ago.

Data produced by UK Finance reveals there were 9,960 first time buyers in London for the second quarter of 2019 increasing by 1.2% year-on-year and a boost to new purchases in the capital.

Compared to the last quarter first time buyer numbers are up 5.3% from 9,450 and the value of new mortgages year-on-year is higher by 7.5% at £2.9 billion.

This is in contrast to the UK as a whole where the number of first timbers reduced by -1.5% compared to a year ago to 32,760 although compared to last quarter the numbers are 6.1% higher.

Large falls for remortgage buyers

For the second quarter in the capital there were 13,030 new homeowner remortgage buyers, -9.5% fewer than the same quarter in 2018 and the value of lending of £4.0 billion was lower by -11.6%.

The figures across the UK are even worse for homeowner remortgages without further equity withdrawn as numbers are lower by -23.9% year-on-year to June at 15,230 and the value of lending down -26.7% at £2.7 billion.

In London the average borrowing for remortgage buyers was £310,807 with a loan to value of 51.5% with a property value of £603,508.

These homeowners are aged 42 with property equity of £292,701, income to loan multiples of 3.08 and monthly mortgage repayment is 16.5% of household income.

First time buyers in the capital borrow an average of £298,560 and with loan to value of 67.5% the property value is £442,967.

The average age in London to buy their home is 33, placing a deposit of £144,407 and income to loan multiple of 3.80 with 17.6% of their household income going to the mortgage.

Fewer home movers in London

Compared to a year ago, the number of home movers in London has reduced by -3.0% to 6,240 for the second quarter with lending values increasing 4.2% to £2.7 billion.

Changes in home mover numbers were similar for the UK lower by -3.6% for the year to June 2019 with the value of lending only slightly higher by 0.7% to £7.0 billion.

In terms of affordability in London second steppers borrow £439,884 with a loan to value of 65.5% with a property value of £671,578.

The amount of equity in their homes is £231,694 with income to loan multiples of 3.77, monthly mortgage repayment is 17.7% of household income and average ages of 39 years.

Older equity release mortgage buyers can stay in their home rather than move by downsizing, accessing the wealth in their property to improve their quality of life or for a holiday of a lifetime.

Even buy-to-let landlords do not need to sell their property portfolio at retirement as they can increase their income using a lifetime mortgage as there are no interest payments to make.

What are your next steps?

Call our LCM mortgage brokers for advice if you are a first time buyer, want to remortgage your existing home for the best mortgage deal, moving home or a buy-to-let investor.

Learn more by using the property value tracker chart, mortgage costs calculator and equity release mortgage calculator. Start with a free mortgage quote or call us and we can take your details.

For equity release buyers our London City Mortgage advisers can recommend lifetime mortgages allowing you to receive cash from your property to repay an interest only mortgage or purchase a new car.


Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

1.16% Fixed Rate
60% Loan to Value
£1,525 App Fee
Until 01/11/2022
Reverts to 4.09%
1.19% Fixed Rate
60% Loan to Value
£999 App Fee
2-Years Time
Reverts to 3.59%
1.18% Fixed Rate
60% Loan to Value
£1,034 App Fee
Until 31/10/2022
Reverts to 3.59%
1.17% Fixed Rate
60% Loan to Value
£1,025 App Fee
Until 31/09/2022
Reverts to 3.59%

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  • IMPORTANT

    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.

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