The total value of outstanding residential mortgage loans in the UK rose to a record £1,678.2 billion in Q4 2024, marking a 0.5% increase from the previous quarter and a 1.3% rise year-on-year, Bank of England mortgage lending data revealed yesterday.
The Bank highlighted an uptick in mortgage activity, with gross mortgage advances rising by 4.9% on the quarter to £68.8 billion – the highest level since late 2022.
Meanwhile, new mortgage commitments surged by over 50% compared to a year ago, reaching £69.3 billion, indicating a strong pipeline of lending in the coming months.
Despite ongoing affordability pressures, first-time buyer activity remains robust, with their share of mortgage lending hitting 29.6% – the highest level since records began in 2007.
STRETCHED FINANCES
However, with loan-to-income (LTI) ratios rising to 45.8%, borrowers are stretching their finances further to access homeownership, particularly in higher-priced regions.
Toby Leek, President of NAEA Propertymark, says: “The news that the number of first-time buyers is increasing is extremely positive.
“However, other data also suggests that the average person looking to step onto the ladder for the first time will likely find it increasingly difficult to do so in the future. With the average age of a first-time buyer increasing to around 33.5 years old and the amount of money needed to be put down as a deposit on a home continuing to rise to around £50,000, many people may find their home ownership aspirations difficult to achieve.
“To combat this, all governments need to implement support mechanisms to enable more people to buy their first home well into the future, as well as continue in their missions of building new homes for a growing population, as an undersupply of properties will push up house prices even further.”
