New CML data released today on the profile of mortgage lending in Northern Ireland in the first quarter of 2014 shows year-on-year growth, in particular, for home movers and first-time buyers but the expected seasonal dip has affected lending compared to the previous quarter.
Lending for home-owner house purchase in Northern Ireland decreased in the first quarter of 2014 compared to the previous quarter with a total of 2,700 loans advanced. This was down 7% compared to the fourth quarter of 2013 but was up 35% compared to the first quarter of 2013. The value of new loans to home-owners for house purchase was £240m, down 11% on the fourth quarter of 2013 but up 41% compared to quarter one 2013.
First-time buyers in Northern Ireland took out 1,600 loans, a decrease of 11% compared to the fourth quarter of 2013 but up 33% compared to the first quarter of 2013. These loans totalled £130m in value, 7% lower than the previous quarter but up 44% compared to the first quarter of 2013.
The typical first-time buyer in Northern Ireland borrowed 2.91 times their gross income in the first quarter of 2014, which was lower than the UK average of 3.42. This was an increase from the last quarter of 2013 when it was 2.85 and up from 2.80 in the first quarter of 2013. The typical loan size for first-time buyers in Northern Ireland was £72,000, which was less than the UK average of £118,750 in the same period. First time buyers’ typical household income was almost unchanged at £25,000 from £24,982 in quarter four of 2013.
First-time buyers spent 16.9% of their gross income on capital and interest payments, lower than the UK average of 19.3%, but only slightly changed from 16.8% in the previous quarter and 17.2% in the first quarter of 2013.
Overall for the first quarter of 2014, home movers in Northern Ireland took out 1,100 loans, with a value of £120m. This was unchanged compared to the previous quarter in volume but down from £130m in value. However, compared with the first quarter of 2013, this was a rise of 38% by volume and 50% by value.
Home-owner remortgage activity in Northern Ireland in the first quarter of 2014 decreased to 1,100 loans, down 15% compared to the previous quarter but an increase of 10% compared to quarter one of 2013. These loans totalled £100m in value, which was down 17% from the previous quarter but up 11% compared to the same quarter in 2013.
Brian McCormick, chair of the CML in Northern Ireland, said: “The strong upward year-on-year trend in Northern Ireland is showing growth in all borrower types. In particular, it is good to see affordability for first-time buyers remain at a more favourable level than the UK overall.
“Northern Ireland has very particular challenges compared to the rest of the UK so seeing increased activity over the past few quarters shows progress that will hopefully continue going forward.”
