First time buyer mortgages strong despite ongoing Brexit uncertainty

Figures released this morning show a surge in first time buyers securing mortgages in recent months, despite the market showing continued signs of Brexit-fuelled uncertainty.

Data from the Intermediary Mortgage Lenders Association - referring to the final quarter of 2018 - shows that 89 per cent of first time buyer mortgage offers were completed in that three month period. This is a three year high and is up from 81 per cent in the third quarter of 2018.

Brokers reported overall mortgage completions (to all buyers, not just first timers) were up by five per cent quarter-on-quarter at the end of 2018, to 87 per cent – the highest figure on record.

This bump in intermediary activity comes as UK Finance found that the number of first time buyers securing mortgages in 2018 reached its highest annual level in 12 years. 

According to IMLA some of the recent growth in first time buyer activity has been attributed to the growth of Help to Buy in allowing younger people to get on the housing ladder. 

As well as strong FTB figures, mortgage intermediaries reported stronger completion rates across the board in the last quarter of 2018.

Buy to let lending was also more positive in the final quarter of last year, despite fiscal and regulatory burdens increasing on landlords. Offers to completion rose three per cent to 85 per cent, according to intermediaries.

IMLA recently predicted that mortgage lending via intermediaries will rise to £169 billion this year as the share of lending introduced by intermediaries rises to 75 per cent in 2019 and 76 per cent by 2020.

However, the association warns that confidence has ebbed as brokers continue to experience a Brexit ‘uncertainty effect’. 

The percentage of brokers who professed to be “very confident” about their own business has fallen from 60 per cent to 54 per cent in Q4 2018, the second dip in confidence in as many quarters.