Glimmer Of Hope In Homes Market

THERE was a glimmer of activity in the housing market at the end of last year according to the latest stats from the Council of Mortgage Lenders.

A rise in mortgage lending towards the end of 2011 is a welcome indicator for the industry 

Almost £7billion was lent to buy 47,000 properties in November, 17,300 of those to first time buyers.

Interesting that although the total number of mortgage deals and sales has declined markedly since the credit crunch, the proportion of loans advanced to first-time buyers has remained remarkably steady, fluctuating between 34-40% since 2005. It was 37% in November.

 A lot of existing home owners  decided to re-mortgage in November, taking advantage of some keener fixed term rates after speculation that interest rates will have to go up at some point soon if inflation does not start falling. There were 31,200 loans worth £4 billion.

CML director general Paul Smee said: “A rise in mortgage lending towards the end of 2011 is a welcome indicator for the industry considering confidence has been weak due to fragile economies both at home and in the Eurozone.

“We should expect a further increase in first-time buyer activity over the next few months as they push through their purchases to take advantage of the stamp duty concession before it ends in March."

First time buyers are currently exempt from paying 1% stamp duty on properties priced between £125,000 and £250,000 if they exchange before 24 March.  No-one pays stamp duty on properties under £125,000 .