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Young people half as likely to own a home as two decades ago

Millennials’ chances of owning their own home in their early 20s have nearly halved over the past two decades, according to new figures.

Only 11% of people born in the mid-1990s were homeowners by the age of 22, compared to 21% of people born in the mid-1970s.

Many young people will be “stuck renting into retirement,” according to an analysis of official figures by the Local Government Association (LGA), which represents councils.

The LGA says home ownership is a “distant dream” for many would-be buyers as the high costs of renting privately prevent them saving for a deposit.

Rents now eat up more than half of average household earnings in some parts of London, according to the LGA.

Separate figures released by HomeTrack on Thursday show first-time buyers need an average household income of £54,400 to afford a mortgage for their first home.

Boris Johnson, the frontrunner in the race to be the next UK prime minister, is reportedly considering scrapping stamp duty on homes under £500,000 if Britain crashes out of the EU without a deal.

First-time buyers already benefit from lower or zero stamp duty depending on a property’s value, but analysis by Yahoo Finance UK suggests it could save them up to £10,000 on their first home.

Martin Tett, LGA housing spokesman and leader of Buckinghamshire county council, said: “Home ownership remains a distant dream for most young people, with the high cost of the private rental sector meaning many are unable to save for a deposit to get on to the property ladder and face the prospect of being stuck renting into retirement.”

The LGA is calling for more powers for councils to build new social housing and take control of the right-to-buy scheme ahead of its annual conference next week.

Lindsay Judge, senior policy analyst at the Resolution Foundation, told Yahoo Finance UK said more security for the record number of families renting privately was also key.

“While home ownership has finally started to rise in recent years, young families are still far less likely to own by their early 30s than their parents were. The barriers to home ownership remain significant.”

By Tom Belger

Source: Yahoo Finance UK

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First-time buyers need to earn £54,400 to get on the property ladder

The average first-time buyer needs a household income of £54,400 to get on the property ladder in British cities, new figures suggest.

First-time buyers need to earn more now than three years ago in most UK cities, with the exception of the most expensive areas—where buying is now marginally more affordable.

The average house price in 20 UK cities is now £256,200, up 1.8% on a year ago, according to a monthly review of the UK property market by Hometrack.

Fast-rising property prices in Manchester and Leicester mean first-time buyers now need to earn around 20% more than three years ago.

The highest increases in house prices have been in some of the most affordable cities, with prices up 5% in Liverpool and 4.6% in Belfast.

Buyers can secure their first home of their own on a total household income of £26,000 in Liverpool and Glasgow, whereas Londoners need £84,000 a year.

But the expensive cities where buyers need the highest income have seen the property market become slightly more affordable in recent years.

London, Oxford and Cambridge have seen the average income to buy fall 5% since 2016.

The latest Hometrack report says house prices in UK cities have grown around 7% a year for the past 23 years, far outstripping growth incomes.

Separate figures released today by Lloyds Bank also show the number of homes worth £1m or more has reached a record high.

More than 14,600 homes worth at least £1m were sold in 2018, up 1% on the previous year despite a slowdown in the property market particularly in London and the south-east.

By Tom Belger

Source: Yahoo Finance UK

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Many people using Help To Buy scheme ‘could have bought a property anyway’

Significant numbers of people using the Government’s Help to Buy equity loan scheme in England would have been able to purchase a home anyway, according to a spending watchdog.

Around one in 25 home buyers using the scheme had household incomes of over £100,000, the National Audit Office (NAO) said.

The scheme had also helped to support large developers’ annual profits, according to the NAO, which said it was too early to tell whether the initiative had provided value for money.

Five firms combined – Redrow, Bellway, Taylor Wimpey, Barratt and Persimmon – accounted for just over half of sales made across England with the support of the scheme between 2013 and 2018.

It’s now beyond clear that rather than helping those who can’t afford to buy a home, Help to Buy has mainly been a subsidy for a housing bubble

Fran Boait, Positive Money

Redrow made up 3.7% of sales, Bellway accounted for 6.7%, Taylor Wimpey made up 11.9%, Barratt made up 13.3% and Persimmon accounted for 14.8%, according to the NAO’s analysis.

Larger firms tended to be better equipped to administer the scheme, the report said.

The NAO said the Government’s challenge now was to wean the property market off the scheme, which was launched in April 2013.

Research found 37% of households would not have been able to buy any property without the scheme.

But nearly a third (31% ) of buyers could have purchased a property they wanted without the scheme.

81% – Percentage of buyers supported by the Help To Buy equity loan scheme in England who are first-time buyers

And some buyers could have bought a property without the support of Help to Buy, but not necessarily a property they wanted.

 Around 4% of the 211,000 buyers who had used the scheme by December 2018 had household incomes of over £100,000.

Over the whole scheme, which is not means-tested, 10% of buyers had household incomes of over £80,000, or over £90,000 in London.

Commenting on the report, Fran Boait, executive director of campaigning body Positive Money, said: “It’s now beyond clear that rather than helping those who can’t afford to buy a home, Help to Buy has mainly been a subsidy for a housing bubble, benefiting property developers and existing home owners.”

The NAO’s analysis found that buyers who had used Help to Buy had paid less than 1% more than they might have paid for a similar new-build property bought without the support of the scheme.

(Help to Buy) has exposed the Government to significant market risk if property values fall, as well as tying up a significant public financial capacity

Gareth Davies, head of the NAO

By 2023, the net amount loaned through the scheme is forecast to peak at around £25 billion, with the investment expected to be recovered by 2031/32 and a positive return made overall.

But the NAO said the investment was exposed to significant market risk as it was sensitive to house price changes and the timing of buyers repaying loans.

It said there was also a cost in terms of opportunity in tying up money for a considerable period, rendering it unavailable for other housing schemes or priorities.

The scheme was launched by what is now the Ministry of Housing, Communities and Local Government.

Home buyers receive an equity loan of up to 20% (or 40% in London) of the market value of a new-build property. They are not charged loan fees on the loan for the first five years of owning their home.

Between the start of the scheme in April 2013 and September 2018, 38% of all new-build property sales were supported by loans through the scheme, accounting for around 4% of total house purchases across England during this time.

Around 81% of all buyers supported by the scheme were first-time buyers.

It was announced in 2018 that from April 2021, the revised scheme would be restricted just to first-time buyers, with lower regional limits on the maximum house purchase price.

The NAO said changes to the scheme aimed to reduce overall demand for it in its final two years, preparing the housing sector for its end in 2023.

Take-up of the scheme had been lower in London, where average house price-to-earnings ratios were higher, compared with the rest of England, the NAO’s report said.

Gareth Davies, head of the NAO, said: “Help to Buy has increased home ownership and housing supply, particularly for first-time buyers.

“However, a proportion of participants could have afforded to buy a home without the Government’s help.

“The scheme has also exposed the Government to significant market risk if property values fall, as well as tying up a significant public financial capacity.

“The Government’s greatest challenge now is to wean the property market off the scheme with as little impact as possible on its ambition of creating 300,000 homes a year from the mid-2020s.

“Until we can observe its longer-term effects on the property market and whether the department has recovered its substantial investment, we cannot say whether the scheme has delivered value for money.”

A spokesman for the Home Builders Federation (HBF) said Help to Buy has delivered against its objectives, to increase home ownership, boost housing supply and generate economic activity.

He said: “Help to Buy has been central to supporting new-build sales rates, and thus the construction of desperately needed homes, while the wider second-hand market has remained sluggish.

“At present, the mortgage market is not equipped to support realistic lending to first-time buyers purchasing in the new-build sector.

“We will continue to work with lenders and stakeholders to try and ensure the withdrawal of Help to Buy does not lead to reduced housing supply or first-time buyer aspiration.”

Housing Minister Kit Malthouse said: “Help to Buy has been genuinely life changing for first-time buyers across the country, helping them secure their first step on the property ladder.”

He said the scheme has been “win-win” – supporting first time buyers, increasing home building and also set to make a profit for the public.

He said: “From 2021 the scheme will be extended and strengthened to make it exclusively for first-time buyers to support those who need it most.”

Source: Shropshire Star

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Housing Secretary in backlash after proposing buyers raid pension pots to buy homes

Housing Secretary James Brokenshire has clashed with Government departments and pension experts after he proposed allowing first-time buyers to use their pension savings to raise a deposit to buy their home.

The idea was immediately quashed by former pensions minister Steve Webb, warning that it risks ruining people’s retirement.

The Department for Work and Pensions is also reported to have complained that it did not approve and had not been informed of the proposal.

There were also suggestions that Brokenshire’s proposal would simply hike house prices.

Speaking at the Policy Exchange think tank, Brokenshire said the Government should look at allowing an individual to use part of their pension pot as a deposit on a first-time home purchase.

He said: “We should be changing the necessary regulations to allow this to happen, protecting the integrity of pension investments but allowing lenders to innovate and design new products to bring this opportunity to consumers.

“It seems rather obtuse that we would deny people the opportunity to do this, given that we know those who own their own home by retirement are on average a) wealthier and b) do not have the burden of the largest expense in retirement – accommodation.

“And it is, after all, their money.”

He said the average 35 to 44-year-old has a pension wealth of approximately £35,000 and could combine that with a partner to support a deposit.

He added: “To those who are in their 20s and finding it difficult to save, this idea offers a genuine route to a deposit.

“We can say to that generation that there is a way, they do have a choice, they too will have that freedom.”

Brokenshire said similar schemes already exist within New Zealand’s Kiwisaver and in Canada where regulations were recently changed to allow people to use up to $35,000 of their pension savings to purchase a home.

A spokesman for Brokenshire said the timing of the introduction of such a scheme would be up to the next Prime Minister once Theresa May is replaced.

Such a change would require industry consultation, which could include elements such as a cap on withdrawals.

The spokesman denied this could create a bigger pensions crisis in the future, adding: “There are multiple models that would protect the integrity of pension investments.

“This assumes everyone would use the new freedom, which is not likely. The idea is about accessing their pension pots earlier and still having decades beyond to save.”

Internal departmental analysis by the Ministry of Housing, seen by EYE, suggests buyers may end up with a lower value pensions pot over 30 years, but would have higher monthly savings due to mortgage repayments being cheaper than renting and would have a financial asset by owning a property.

Webb, a pensions minister in the Conservative and Liberal Democrat coalition government and now director of policy at Royal London, said: “The amounts going into pensions for young people are pretty small already but at least they are starting young – if you empty that then they’ll end up working till they’re 75.

“It is fine to find giving young people new ways of buying a home but if there aren’t enough houses, then you have not helped them get a house and you’ve ruined their retirement.”

Tom Selby, senior analyst at AJ Bell, said: “This idea smacks of dangerous political short-termism.

“While the housing market clearly has its problems – particularly for first-time buyers who might struggle to afford the sizeable deposits now demanded by lenders – allowing people to raid their pensions is not a sensible answer.

“Chronic undersaving for later life is one of the biggest challenges facing society today, so a proposal which encourages people to drain their pension pots risks making this problem even worse.

“There is no guarantee that such a proposal would actually help people get on the housing ladder at all.

“Unless the Government dramatically boosts the supply of homes in the UK then this plan risks stoking house price inflation.

“It’s also not clear why housing should be the only beneficiary of early pensions access. People could legitimately ask why, for example, it shouldn’t be extended to cover debt repayments or to help towards wedding costs.

“The further you go down this rabbit hole the greater the risk you fundamentally undermine the central plinths of the UK’s retirement savings landscape.”

By MARC SHOFFMAN

Source: Property Industry Eye

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Drop in first-time buyers a concern

The housing market would face a disaster if the number of first-time buyers entering continues to drop, according to housing experts.

This month (May 16) UK Finance lending trends showed there were about 28,800 first-time buyers with new homes in March — 2.4 per cent fewer than in the same month in 2018 and the first month there had been a year-on-year decrease since September 2018.

Up until then the ailing housing market had been largely bolstered by this group of buyers.

Steve Brown, branch manager at Winkworth Estate Agents in Blackheath, said it would be “disastrous” for the housing market if this continued as “first-time buyers hold all the cards”.

He said: “These buyers coming in at entry level means the people in those houses can now sell, often moving to family homes or larger properties.

“If the first-time buyers aren’t there, these people become stuck and the market would slow considerably as part of the knock on effect.

“House prices would be hit hard. You would see a drop in house prices fairly quickly of about 5 to 10 per cent.”

Mr Brown went on to say that first-time buyers had become even more vital to the housing market since changes in the buy-to-let market meant it was no longer financially viable for those struggling to sell to rent out the property instead.

Landlords saw an additional 3 per cent stamp duty surcharge on second homes in April 2016 alongside phased cuts to mortgage interest tax relief, while buy-to-let borrowers are now subject to more stringent affordability testing under the Prudential Regulation Authority’s tightened underwriting rules.

Mark Harris, chief executive of SPF Private Clients, also said the decrease in the number of new buyers after a period of continuous growth was concerning for the market.

He said: “First-time buyers are so important for the overall health of the housing market, ensuring transactions further up the chain can happen.”

Dan White, of White Financial Services, agreed that the market should “absolutely be worried” if first-time buyer numbers started to slip and stressed there was not enough innovation being pushed to help those looking to make their first steps onto the property ladder.

He added that the market was not an easy one for first-time buyers, particularly as the current generation of new buyers were suffering from huge inflation to house prices over the previous years and a restriction in wage growth in the majority of sectors.

He said: “The income to house price ratios just don’t correlate. Even in the most affordable towns, first-time buyers are still faced with at least a six or seven times income multiple.

“Once you look at the mortgage affordability assessments with lenders and take into consideration their lending restrictions on income multiples at certain loan to value levels, it leaves the first-time buyer with very little options.”

But others say it’s “too soon” to tell if the UK Finance stats are part of a long-term trend that would cause concern for the market.

Carmen Green, adviser at Xpress Mortgages, said: “I have witnessed several occasions where first-time buyers have grabbed a bargain as they jump in to fix chains that have collapsed in an otherwise shaky market.

“Particularly in the south east, the fall in property prices has given opportunity to first-time buyers who otherwise wouldn’t be able to afford to buy.”

Steve Patterson, director at Teeside Money, agreed that although a drop in the number of new buyers could cause a domino effect on the market, he said he “was not concerned at this stage”.

He said: “I think it will just be a blip. I don’t think there will be a big decline in the numbers unless there is a major impact to lending.”

By Imogen Tew

Source: FT Adviser

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First-time buyer purchases down 2.4%

The number of consumers borrowing to buy a new property was down across first-time buyers, home-movers and buy-to-let purchases in March, when compared with last year.

UK Finance’s mortgage lending trends, published today (May 16), showed there were about 28,800 first-time buyers with new homes in March — 2.4 per cent fewer than in the same month in 2018.

According to the trade body, this was the first month there had been a year-on-year decrease in first-time buyers since September 2018.

There was also a decline in the number of completed home-mover mortgages, which fell by 6 per cent to 25,280 compared to March 2018.

Mark Harris, chief executive of SPF Private Clients, said: “The decrease in number of first-time buyers after continuous growth over the past six months is a concern, and let’s hope it is just a blip in the numbers.

“First-time buyers are so important for the overall health of the housing market, ensuring transactions further up the chain can happen.”

The remortgage market continued to fare better however and in total, there were 4.1 per cent more residential remortgages in March than in the same month the year before.

Within this, there was a rise in the number of those who borrowed more money through their remortgage — up 9.1 per cent to 16,810 — while ‘pound for pound’ remortgages, where the consumer does not borrow any more money, dropped slightly by 1.1 per cent to 15,030.

This was the twelfth consecutive month of year-on-year growth in remortgaging and, according the UK Finance, this reflected the number of fixed-rate deals that are coming to an end as borrowers actively search for better, more attractive rates.

The remortgage market also grew in the buy-to-let sector but the purchase market declined.

About 5,000 new buy-to-let purchase mortgages completed in March, which was 9.1 per cent fewer than in the same month in 2018, while the number of remortgages increased by 3.9 per cent year-on-year to 14,400.

UK Finance stated the buy-to-let house purchase activity continued to contract due to tax and regulatory changes.

Gareth Lewis, commercial director of property lender MT Finance, agreed.

He added: “Remortgaging is up as those who bought before stamp duty hikes were introduced in 2016 are now remortgaging their fixed rates onto another competitive deal.

“Borrowers are taking out longer-term fixes on residential and buy-to-let deals as they protect themselves from wider uncertainty.”

In January, the Intermediary Mortgage Lenders Association warned that landlords would start to feel the pinch of new regulation in their tax returns for the first time, included the introduction of an additional 3 per cent stamp duty surcharge on second homes in April 2016 and cuts to mortgage interest tax relief.

Buy-to-let borrowers are also now subject to more stringent affordability testing under the Prudential Regulation Authority’s tightened underwriting rules.

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said despite potentially disappointing numbers, there were no significant movements one way or the other.

He said: “[These figures] reflect what we are seeing at the coalface — it is a bit busier one month but down the next and then up again.

“It is no surprise either that buy-to-let mortgages are continuing their downwards trend as landlords face an onslaught of tax and regulatory changes with more on the way.

“We are finding buy-to-let remortgaging increasing is down to properties having to work harder in order to maintain profit levels so this is likely to continue.”

By Imogen Tew

Source: FT Adviser

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Why now is the perfect time to be a first-time buyer

It argues that first-time buyers can take advantage of cheap mortgage rates and stalling house prices as well as the Help to Buy ISA scheme, which ends later this year.

Rates on high loan-to-value (LTV) mortgages, which require borrowers to have a small deposit so are popular with first-time purchasers, are at a record low.

The average interest rate on a two-year fixed 95% LTV mortgage has fallen from 3.95% a year ago to 3.23% today, Defaqto data shows.

First-time buyers can also benefit from a weakening housing market.

Nationwide, the UK’s largest building society, last week reported that annual house price growth was just 0.9% in April, marking the fifth straight month of weak house price inflation.

Figures from The Royal Institution of Chartered Surveyors in March show that the number of properties coming onto the market has fallen for the past eight consecutive months.

But Defaqto warns first-time buyers need to hurry if they want to take advantage of the government’s Help to Buy ISA scheme, which closes to new entrants on 30 November 2019.

The scheme, which was specifically designed to help people get on the property ladder, lets savers put away up to £1,200 in the first month and then £200 a month after that, and the government will add 25% tax-free up to a maximum of £3,000 (or £6,000 if two people are buying together).

Savers can continue to save into a Help to Buy ISA until 1 December 2030.

Katie Brain, insight analyst at Defaqto, said: “Buying a home is an expensive undertaking and for many years we have seen that first rung of the property ladder move further out of the reach of first time buyers.

“Now, with stalling house prices and cheaper borrowing, we are entering a period of opportunity for buyers looking to make their first home purchase.

“For those looking to get a mortgage, it is important to do your sums and check exactly what you can afford to borrow. While interest rates are low, an increase of just 1% can add hundreds of pounds to a monthly repayment and thousands to the overall cost of a home.”

first-time buyers

Written by: Joanna Faith

Source: Your Money

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First Time Buyers Helped by Weak House Price Growth

House price growth in the UK remained subdued for the fifth month in a row in April, according to the latest figures from Nationwide.

House prices in the country grew 0.9% in April compared to the same time last year – a slight rise from the 0.7% annual growth seen in March. Annual house price growth has in fact been below 1% every month since December 2018. However, house prices actually fell month-on-month in April, dropping by 0.4% in April. According to the Nationwide House Price Index, the average price of a home in the UK is now £214,920.

Before the Brexit referendum in 2016, house prices in the UK were growing by around 5% each year. But as many market analysts have mentioned Brexit uncertainty as a cause of the subdued growth seen recently, the stagnating prices have helped to attract a growing number of first-time buyers to the market.

The number of mortgages being taken out by first-time buyers today is approaching the levels seen before the global financial crisis in 2008. As well as the slow growth of property prices, first-time buyers are also being attracted to the housing market due to high employment rates, real wage growth and low mortgage rates.

“While the number of properties coming onto the market has also slowed, this doesn’t appear to have been enough to prevent a modest shift in the balance of supply and demand in favour of buyers in recent months,” said Robert Gardner, chief economist at Nationwide.

“While the ongoing economic uncertainties have clearly been weighing on consumer sentiment, this hasn’t prevented further steady gains in the number of first-time buyers entering the housing market in recent quarters. Indeed, the number of mortgages being taken out by first-time buyers has continued to approach pre-financial crisis levels in recent months.”

While low mortgage rates, the strength of the labour market and projects such as the government’s Help to Buy scheme are helping first-time buyers get onto the property ladder, the biggest obstacle remains raising a large enough deposit.

“First time buyer numbers have been supported by the strength of the labour market conditions, with employment rising at a healthy rate, and earnings growth slowly gathering momentum,” said Gardner. “While house prices remain high relative to average earnings, low mortgage rates have helped to support mortgage affordability. Indeed, raising a deposit appears to be the major barrier for prospective first-time buyers.”

Jeremy Leaf, former residential chairman at RICS, said: “Soft growth in the last set of figures from Nationwide is continuing and confirmed on the high street. Clearly, Brexit uncertainty in the minds of homebuyers is still outweighing almost record low mortgage rates and employment numbers as well as improved affordability. A glimmer of good news is that first-time buyers are taking advantage, particularly of help to buy and deposits from the bank of mum and dad, not forgetting reduced competition from landlords.”

Source: Money Expert

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1,000 homes a week purchased through Help to Buy last year

Just over 52,000 homes were purchased through the Help to Buy: Equity Loan scheme in England in 2018 – a 12% increase on the previous year, the latest government figures showed.

Across what’s being hailed as a very successful year for Help to Buy by mortgage industry figures, an average of around 1000 households per week bought property through the scheme.

The Ministry of Housing, Communities and Local Government (MHCLG) introduced Help to Buy in 2014 as a way of assisting first time buyers trying to get on the property ladder, and the total number of homes bought with its help since its inception is now above 210,000.

More than 42,000 (81%) of homes bought in England in 2018 through Help to Buy were purchased by first-time buyers – a 14% increase on 2017 – which means one in seven purchases by first-timers was through Help to Buy.

Recent research showed first-time buyers needed to find a deposit of more than £30,000 in order to purchase a home in 2018 – an increase on the previous year.

Very successful year
Kate Davies, executive of Intermediary Mortgage Lenders Association (IMLA), said: “The statistics for 2018 highlight a very successful year for Help to Buy. The government’s programme has continued to stimulate the bottom of the housing ladder and indirectly support the whole of the UK property sector throughout 2018.

“With as many as one in every seven first-time buyers using Help to Buy in England in 2018, it is likely that the programme will remain invaluable in supporting home buyers over the remaining years of the scheme.

“While we are yet to see if the programme is continuing to grow in 2019, strong HMRC transaction statistics for Q1 2019 possibly indicate that Help to Buy-fuelled sales are still running at a healthy pace, continuing the trend we have been witnessing for more than a year.”

Beyond 2023
The government has indicated that Help to Buy will come to an end in 2023 and, while welcoming the figures for 2018, Craig Hall, head of broker relationships and propositions at Legal & General Mortgage Club, warned that first time buyers need further help.

He said: “Looking beyond the scheme’s end, it’s vital that government and industry works together to ensure these buyers remain supported. It’s likely that we may see private schemes coming to market to help fill the void.”

He added that higher LTV lending from mortgage providers and family assist mortgages are also helping first-time buyers, who should always seek out the expertise of a mortgage broker before taking any course of action.

Written by: Max Liu

Source: Your Money

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First-time buyer completions up 4.1%

The number of first-time buyers completing mortgages has increased by 4.1 per cent since last year, according to UK Finance.

UK Finance’s mortgage lending trends, published today (April 17), showed that 24,800 first-time buyers took out a mortgage in February 2019 — 4.1 per cent more than in the same month in 2018.

The trade body stated this was the fifth consecutive month of year-on-year growth in first-time buyer numbers.

However, the number of current home owners moving house remained steady, rising 0.1 per cent in the year to 23,660.

The remortgaging market fared better. About 18,200 people remortgaged their home to gain extra funds — 10 per cent up on February 2018 — and those remortgaging without borrowing money increased by 7.8 per cent to 18,360.

On average, those remortgaging had a 43 per cent deposit and their loan-to-income ratio was 2.74.

This was considerably lower than residential mortgages which showed an average LTV of 72 per cent and a loan-to-income ratio of 3.37.

UK Finance stated customer engagement in the remortgaging market remained high with borrowers able to access a wide range of competitive products.

The trends showed buy-to-let mortgages were on the decline as only 4,800 buy-to-let mortgages completed in February 2019 — 7.7 per cent fewer than in the same month in 2018.

More people opted to remortgage in the buy-to-let market as 14,400 remortgages, 2.1 per cent more than the same period last year, were completed in the month.

UK Finance suggested the buy-to-let house purchase market continued to contract due to tax and regulatory changes, while buy-to-let remortgaging increased as borrowers moved from fixed rate mortgages and locked into attractive new rates.

Commenting on the findings, Dave Harris, chief executive of More 2 Life, said: “The growing number of first-time buyers in the market can in part be attributed to parents passing on wealth to their children to help with home purchases.

“With wages still failing to keep up with inflation, the pockets of most first-time buyers aren’t proving deep enough to provide the often hefty mortgage deposits they need to take a first step on the property ladder – but thankfully, this is where parents and grandparents are stepping in to help.”

David Copland, director of mortgage services at TMA, said while activity in the first-time buyer segment continued its upward trajectory, more attention was needed to help the buy-to-let market.

He said: “As previous tax and regulatory changes continue to loom over the private rental sector, advisers will prove essential in guiding these customers towards the best solutions to fit their individual needs.”

Richard Pike, Phoebus Software sales and marketing director, agreed that buy-to-let purchases continued to struggle but suggested that, like many areas that require an element of investor risk, this could have been affected by continued Brexit uncertainty.

He said: “It is difficult to overstate the impact the current negotiations between Westminster and Europe are having on the UK as a whole. We have been in a state of limbo since Article 50 was triggered and there is still no sign of a solution.

“This is, of course, having a knock-on effect and it is highly likely that the figures we will see in the coming months, which reflect the run-up to the original withdrawal deadline, will be more subdued.”

However, Mr Pike added there were positives to be taken from the UK Finance figures as the market had managed to keep ahead compared to 2018 in most areas.

He added: “When you consider these figures only tell part of the lending story in the UK, that is encouraging.”

By Imogen Tew

Source: FT Adviser