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Number of first-time buyer mortgages handed out reached 12-year high in August

The number of mortgages being handed out to first-time buyers jumped to a 12-year high in August, figures from a trade association show.

Housing market experts suggested that stamp duty relief for the sector combined with reduced competition for homes from buy-to-let landlords and a sense of urgency fuelled by Brexit are driving first-time buyers forward.

Some 35,010 new first-time buyer mortgages were completed in August, 0.7% higher than a year earlier.

It was the highest total for first-time buyer mortgages for any month since August 2007, UK Finance said.

But the number of mortgages handed out to existing home owners who were moving house was down year-on-year.

There were 35,380 home mover mortgages completed in August, 5.5% fewer than in the same month a year earlier.

Some 5,900 new buy-to-let home purchase mortgages were handed out in August, a 3.3% decrease compared with the same month a year earlier.

There were 13,800 re-mortgages in the buy-to-let sector in August, 0.7% fewer than in the same month in 2018.

Tomer Aboody, director of property lender MT Finance, said stamp duty relief for first-time buyers has helped to boost the market.

He said: “Encouragingly, first-time buyer mortgages are up on last year, which isn’t too surprising considering the low rates and high loan-to-values being offered by lenders, along with a greater number of lenders fighting for market share.

“Lower stamp duty or even nil stamp duty on lower priced property has proved a huge boost to the first-time buyer market.

“This is coupled with a sense of urgency from some in trying to get on the housing ladder before Brexit – there may be uncertainty now, but who knows what the future holds?”

Andrew Montlake, managing director of the UK-wide mortgage broker, Coreco, said: “First-time buyers are absolutely flying.

“They are being driven on by a combination of reduced competition from landlords, once-in-a-lifetime mortgage rates, high employment and the buyers’ market we’re in.”