The FCA have published that 2015 has seen a 23% increase in first time buyers within the first 3 months of the year. This is off course welcome news for both the mortgage and house building industry. An increase in first time buyers taking out new mortgages at this level hasn't been seen since 2004 at the height of the housing market and pre credit crunch conditions.
Mortgage lending is up across the board
Overall mortgage lending has been up 32% on 2014 with the increased popularity of New Buy Scheme and Help to Buy Schemes. Both of which were introduced by the Government to help kick start the housing market and provide a step on the ladder for first time buyers.
John Coleman, Mortgage Advisor at Lendingexpert.co.uk said " We are seeing a lot of interest in both the Help to buy and New buy schemes from first time buyers who have small deposits. Both schemes can be accessed by borrowers with just a low deposit of 5% which is very appealing in todays market place.
What does this mean for house prices?
Some concern has been expressed that house prices may now start to rise again quickly leaving many low income families unable to afford to live in their home town or unable to get the mortgage then need to buy a house locally. However things are different now with mortgage lenders now take a firm and sensible approach with regard mortgage and loan affordability which should prevent the mistakes we made with self certification, and none status mortgages back prior to the credit crunch.
Borrowers now have to demonstrate they can not only afford the mortgage now, but also that they are able to keep up with mortgage payments if interest rates where to rise again in the future.