The CML revealed more FTBs are paying stamp duty earlier this week and it created some debate about what is included in its first-time buyer figures. For the avoidance of doubt, this note explains the data.
The release provided a breakdown of loans for house purchase between first-time buyers and home movers. The foot notes to the data explained that they are based on two sources: the survey of mortgage lenders (up to April 2005) and product sales data reported to us (April 2005 onwards).
We have always been open about the fact that - whichever source of data is used - we are unable to identify (and exclude) from the 'first-time' buyer numbers those buyers who have previously been owner-occupiers but were in another tenure (eg, renting) immediately before their current purchase. In the research we have published on this subject, we have referred to this group as "returners" and have made it clear that there is no way of identifying exactly how first-time buyers many fall into this category.
Within the last 15 months, we have published two pieces of research on this issue: 'Understanding first-time buyers' and 'Will the real first-time buyer please stand up?' In those articles, we pointed out that, while there was no way of identifying different sub-groups of first-time buyers, there has been other research suggesting that around one-fifth of all recorded first-time buyers are, in fact, 'returners.'
Perhaps understandably, not everyone recalls all our research reports (we have published 23 of them in the last 15 months). Nor was everyone able to check our website (where all our research can be readily inspected). So there was a lot of excitement over the apparent 'revelation' that our data has imperfections.
Our press release this week was really only trying to make a simple point: that there has been an increase in the proportion of home-buyers paying stamp duty over the last 12 months. For first-time buyers (including returners), the proportion has risen from 48 per cent to 56 per cent. For home movers, it has gone up from 80 per cent to 86 per cent. We maintain that the fundamental point about the growing numbers of home-buyers paying stamp duty is indisputable - despite the accepted flaws in identifying sub groups of first-time buyers.
