The number of first-time buyers entering the housing market went up significantly in January, compared to the same time last year.
The Council of Mortgage Lenders (CML) has released data for house purchase and remortgage lending rates in January this year.
It has found that the number and value of first-time buyer loans went up by 23% in January, compared to the same month in 2011.
But on a month-on-month basis, the number and value of first-time buyer mortgages fell by 30% from December 2011.
“We traditionally see a substantial fall in lending figures at the start of the year, reflecting the lack of enthusiasm by buyers to move house during the post-Christmas months, and this January has been no exception,” said Paul Smee, director general of the CML.
The overall number of house purchase loans was also up from January 2011, rising by 22% in volume and by 23% in value.
Again there was a dip on the previous month, with 25% fewer house purchase loans worth 24% less than December 2011.
This seasonal pattern is expected by the mortgage lending industry, and is put down to cold weather, lack of daylight and post-Christmas cash-flow problems that deter buyers from moving house.
“The year-on-year rise in house purchase lending suggests that lending levels are generally rising although we expect the trajectory to be bumpy rather than smooth this year,” added Mr Smee.
“Average deposits for first-time buyers have stayed steady at around 20% for over a year but that figure may start to drift down gently over the coming months especially as NewBuy has been launched for new homes.”