First-time buyer and home mover numbers were up by almost a third in the final three months of last year compared to a year ago, according to UK Finance, making 2024 a better-than-expected year for the mortgage market.
It’s likely that some of the growth seen between September and December will be down to buyers looking to complete their property purchases before Stamp Duty thresholds change in April this year. The market is expected to remain strong throughout the first quarter of 2025, with the Bank of England’s latest Money and Credit Report showing that although new mortgage approvals dipped very slightly in January, approvals for homeowners remortgaging rose, after falling for the previous two months.
Overall in 2024, UK Finance said that first-time buyer numbers were up by 16.4% compared to 2023, and home mover numbers by 14.7%. Remortgaging activity was lower in 2024 compared to the previous year, although this is expected to pick up again this year, with 1.8 million fixed rate deals maturing this year. Most borrowers stick with the same lender when remortgaging, although UK Finance said it expects to see a greater number moving to alternative providers in 2025.
Review of mortgage regulation “welcome”
Tightening affordability combined with stricter mortgage rules have made it challenging for buyers to get onto the property ladder in recent years, especially as house prices continue to outstrip wage growth.
However, the Financial Conduct Authority has committed to simplify lending and advice rules for mortgages, which should make it easier to purchase a property.
Eric Leenders, UK Finance’s Managing Director of Personal Finance said: “The regulatory review of mortgage lending rules, which are arguably restricting the number of people who can access mortgage lending, will be welcome news for aspiring homeowners. Reviewing these rules would help with affordability issues, not just for first time buyers but also those looking to move further up the housing ladder.”
