In the longer term, 75% of adults currently living in London would like to own their own home in 10 years time, a slightly lower proportion than in Great Britain overall where 79% of individuals indicated a longer term preference for home ownership.
A total of 9,400 loans were advanced to first-time buyers in the first quarter in London, unchanged from the same quarter last year. This was a more positive result than the figures suggest due to the boost in first-time buyer activity in the first quarter last year as a result of the end of the stamp duty holiday in March.
First-time buyer affordability in London remained tighter than in the UK overall. First-time buyers borrowed an average of 3.58 times their income in the first quarter and their mortgage payments, on average, consumed 21% of their income. This was a marginal improvement compared to the fourth quarter of 2012 and is likely to be due to the continuing downward trend in mortgage interest rates.
The average loan-to-value ratio for first-time buyers remained at 75% in London in the first quarter, below the 80% seen in the UK overall.
As in the UK, lending to home movers in London dipped in the first quarter. A total of 8,000 loans (worth £2.3 billion) were advanced to home movers in London, an 18% fall compared to the fourth quarter of last year, and down by 5% compared to the first quarter of 2012.
Total house purchase lending fell in the first quarter in London compared to both the previous quarter and the first quarter last year. A total of 17,400 loans (worth £4.1 billion) were advanced for house purchase in the first quarter in London, a 12% fall compared to the previous quarter - reflecting the expected seasonal pattern with weaker activity in the first two months of the year.
This also represented a 2% fall compared to the first quarter of 2012 - however when the stamp duty effect is factored in (which boosted activity in the first quarter of last year) this suggests a more positive outcome.
As in the UK overall, remortgage lending in London remained subdued. A total of £1.8 billion was advanced to borrowers remortgaging in the first three months of 2013, an 18% drop compared to the first quarter of last year, similar to the fall seen in the UK as a whole, where remortgage lending dropped by 19% compared to the first quarter of last year.
Commenting on the data, CML director general Paul Smee said: "These figures show that higher house prices and tougher affordability constraints in London have not had a significant impact on consumer appetite to buy or move home in the capital. A similar percentage of those who live in London want to be home-owners despite differences in demographics and population flows.
"Lending activity in London was largely similar to the same period last year, a positive picture bearing in mind the significant boost to the market caused by the end of the stamp duty holiday in March last year."
