First-time buyers appear to have benefited from the government's new lending schemes after experiencing the largest increase in lending for six years in October.
Figures from the Council of Mortgage Lenders (CML) show that banks and building societies provided 26,800 mortgage loans to first-time buyers during the month of October – the highest number since November 2007.
This represents a 16% increase from September, and a 33% increase from October 2012.
The amount advanced to new buyers was also up by 48% on the previous year, to £3.7 billion, which may reflect the decision of many first-time buyers to opt for a larger home.
Connells Group Mortgage Service suggested recently that the second phase of the Help to Buy scheme, which launched in October, had allowed buyers to be “more ambitious in their choice of property”.
However, the figures also demonstrate greater affordability. While the average mortgage value for first-time buyers reached a high of £119,500, average income levels also reached a record level of £36,460.
The figures also emphasise how first-time buyer lending has continued to propel the mortgage market.
Overall house purchase lending rose to £9.7 billion, spread across 60,800 loans, while buy-to-let lending also exceeded £2 billion as the number of loans advanced to landlords rose by 11% from September to 16,200.
"After years of a relatively flat mortgage market, 2013 has shown signs of lending turning a corner and looks set to finish the year strongly," said the CML's Director General, Paul Smee.
"Increased financial optimism among the public as the economy recovers seems to be driving this upward trend and it is welcome to see that first-time buyers continue lending momentum as more look to own their first home," he added.
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