Opinion Former Article

Home buying activity in Northern Ireland up 3% year-on-year in first quarter

In the first quarter:

Home buyers borrowed £350m, down 13% compared to the fourth quarter 2016 but up 3% compared to the first quarter 2016. There were 3,200 taken out for house purchase, down 14% quarter-on-quarter but unchanged compared to a year ago.

First-time buyers borrowed £190m, down 14% on the fourth quarter but up 19% on the first quarter last year. This totalled 2,000 loans, down 9% quarter-on-quarter but up 18% year-on-year.

Home movers borrowed £150m, down 21% quarter-on-quarter and 17% compared to a year ago. This totalled 1,200 loans, down 20% quarter-on-quarter and 14% compared to the same quarter in 2015.

Remortgage activity totalled £200m, unchanged on the fourth quarter but up 18% on the same quarter last year. This came to 2,000 loans, up 5% quarter-on-quarter and 25% compared to a year ago.

Derek Wilson, CML Northern Ireland chair, commented:

First-time buyers continue to be a key driver in Northern Ireland accounting for 63% of lending for house purchase this quarter, the highest proportion since 2001, due in part to affordability being better in Northern Ireland than the UK overall. Seasonal factors and a surge in activity ahead of stamp duty reform a year ago make the home mover picture look more subdued but we expect activity to pick up in the summer months.

After a substantial decline post-recession in Northern Ireland, remortgaging has had a resurgence showing year-on-year growth every quarter for two years running buoyed by attractive mortgage deals in the market.

Affordability in Northern Ireland remains positive

First-time buyers affordability metrics in Northern Ireland remained better in the first quarter than for the UK overall. First-time buyers typically borrowed £95,000 (£133,000 in the UK overall), unchanged from the previous quarter. The average household income was £31,900 (£40,000 in the UK overall), up from £31,800. The typical income multiple in Northern Ireland of 2.92 (compared to 2.88 the previous quarter) also compared favourably to the UK average of 3.53.

Affordability metrics for home movers saw the typical amount borrowed this quarter was £115,000 (£175,000 in the UK overall), up from £112,800 the previous quarter. The average household income of a home mover was £46,000 (£54,600 in the UK overall), down from £46,100. This meant the typical home mover income multiple in Northern Ireland was 2.59, compared to 2.48 the previous quarter and the UK average of 3.34.

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 97% of all residential mortgage lending in the UK. There are 11.1 million mortgages in the UK, with loans worth over £1.3 trillion.

2. Source: CML Regulated Mortgage Survey

3. The Council of Mortgage Lenders does not publish statistics for mortgage approvals. The data in our monthly Regulated Mortgage Survey and gross lending press releases relate to mortgage advances only. A mortgage approval is the firm offer to a customer of a specific amount of credit secured against a particular property. A mortgage advance is the total amount of loan actually provided to the buyer, by the lender. Please see the mortgage statistics timeline on our website for further information.

4. Data for the second quarter of 2017 will be released on Wednesday 23 August 2017.

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