The number of home buyers in the UK’s capital has dropped by almost one fifth during the first quarter of 2017, a report by the Council of Mortgage Lenders shows.
In total, home buyers took out 16,700 loans during the first quarter, which represents a drop by 3% from the previous quarter and by 19% from Q1 2016.
The Council of Mortgage Lenders named affordability issues and supply for the drop, with the addition that winter months usually move slower.
The capital’s first-time buyers took out 10,000 loans during the first quarter, which shows a drop of 5% from the previous quarter as well as 3% from Q1 2016. Typically, first-timers borrowed £254,300, down from £256,000, whilst the whole country averaged at £133,000, CML revealed.
London’s households on average have an income of £64,100, which remained unchanged from the previous quarter. The average for the UK overall lies at £40,000.
Paul Smee, CML director general, said:
“Home buyer activity in London has fallen for the second quarter in a row. A traditional seasonal dip in activity in the winter months is expected, but it has been more pronounced in London compared to the UK overall, as persisting supply and affordability issues continue exerting ongoing restraint on growth. We do expect activity will pick up as we go forward into the summer months.”
“By contrast, remortgage activity was at an eight-year high in London. Attractive mortgage deals aided by low interest rates appear to have sparked a resurgence in activity that has seen consecutive growth year-on-year every quarter for three years.”