While the presence of first time buyers in the mortgage market has diminished since the financial crisis put a squeeze on lending, they have recently started to make a comeback, according to new data from mortgage experts John Charcol.
The latest John Charcol Monthly Mortgage Index shows that of new mortgages written by John Charcol in the first four months of 2009, a fifth of applications came from first time buyers, which is 350 per cent more than in the previous four month period.
Ray Boulger, spokesperson for John Charcol, said that the return of first time buyers to the mortgage
market, amongst a distinct lack of high loan to value mortgages, is surprising, but is currently "one of the best indicators of confidence we've got".
Many potential buyers still managed to scrape together a 25 per cent deposit in order to secure a mortgage, he said: "Many branches of The Bank of Mum and Dad have proved more robust than many of our High Street banks, haven't needed a Government bail-out and recognise that providing their son or daughter with a sizable deposit is often a good way of utilising their savings."
The index also revealed that the majority of homeowners, not just first time buyers
, are opting for fixed rate mortgages to shelter from higher rates, which many analysts predict are on the horizon after the base rate remained static at 0.5 per cent again this month. Fixed rate mortgages
accounted for 82 per cent of all lending at John Charcol in April, up from 80.9 per cent in March, and 70 per cent higher than the 47.8 per cent of applicants who chose to fix in January. Get mortgage quotes »
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