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London home buyer borrowing in first quarter of 2017 down quarter-on-quarter and year-on-year reveals Council of Mortgage Lenders

Home buyer borrowing in London in the first quarter of 2017 was down 3% quarter-on-quarter and 22% year-on-year at £5.4bn, according to the latest figures from the Council of Mortgage Lenders (CML).


They took out 16,700 loans, down 5% compared to the previous quarter and 19% on the first quarter 2016.


First-time buyer borrowing was down 5% on the fourth quarter and 3% on the first quarter last year at £2.8bn. This equated to 10,000 loans, down 5% quarter-on-quarter and 3% year-on-year. 


They typically borrowed £254,300, compared to £133,000 in the UK overall, down from £256,000. The average household income was £64,100, unchanged from the previous quarter giving a typical income multiple in London of 4.00, down from the previous quarter, compared to the UK average of 3.53.


Home movers borrowed £2.7bn, unchanged quarter-on-quarter and down 35% compared to a year ago. They took out 6,800 loans, down 3% quarter-on-quarter and 33% compared to the same quarter in 2016.


The typical amount borrowed this quarter by home movers was £345,300, compared to £175,000 in the UK overall, and up from £340,000 the previous quarter. The average household income of a home mover was £89,300, compared to £54,600 in the UK overall, and up from £88,600. This meant the typical home mover income multiple in London was 3.97, up from 3.96 the previous quarter and higher than the UK average of 3.34.Remortgage activity totalled £4.2bn, up 13% on the fourth quarter and 7% compared to the same quarter last year. This came to 16,700 loans, down 5% quarter-on-quarter and 19% compared to a year ago.


Paul Smee, CML director general, said: “Home buyer activity in London has fallen for the second quarter in a row. A traditional seasonal dip in activity in the winter months is expected, but it has been more pronounced in London compared to the UK overall as persisting supply and affordability issues continue exerting ongoing restraint on growth. We do expect activity will pick up as we go forward into the summer months.

“By contrast, remortgage activity was at an eight-year high in London. Attractive mortgage deals aided by low interest rates appear to have sparked ar esurgence in activity that has seen consecutive growth year-on-year every quarter for three year.”


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