Mortgage lending for first-time buyers at six-year high

First-time buyers enjoyed the biggest surge in lending for six years in October as banks and building societies advanced 26,800 loans, according to the Council of Mortgage Lenders.

The number of loans — the highest since November 2007 — was 33 per cent ahead of last year, and the amount lent totalled £3.7 billion, nearly 50 per cent ahead of a year ago.

CML director-general Paul Smee said: “Increased financial optimism among the public as the economy recovers seems to be driving this upward trend and it is welcome to see that first-time buyers continue lending momentum as more look to own their first home.”

The typical loan size for first-time buyers was £119,500 in October, the highest ever.

But the typical income of first-time buyer households also hit a record high of £36,460, underlining how home ownership has been snatched away from lower paid groups. Total lending for house purchases overall was up 33% year-on-year to £9.7 billion, the CML added.