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BoE: share of lending to FTBs highest since reporting began: "First-time buyers are pushing themselves to the max"

ended 11. March 2025

The Bank of England has just published its quarterly Mortgage Lenders and Administrators Statistics 2024 Q4 report showing lots of interesting data regarding advances, share of lending to FTBs — at a record high — and lending to borrowers at high LTIs, below. Newspage asked brokers for their views, bottom.

  • The outstanding value of all residential mortgage loans increased by 0.5% from the previous quarter to £1,678.2 billion, the highest stock of outstanding mortgage loans since reporting began in 2007, and was 1.3% higher than a year earlier.
  • The value of gross mortgage advances increased by 4.9% from the previous quarter to £68.8 billion, the highest new advances since 2022 Q4, and was 29.9% higher than a year earlier.
  • The share of lending to first time buyers increased by 0.3pp from the previous quarter to 29.6%, the highest share since reporting began in 2007, and was 1.9pp higher than a year earlier.
  • The proportion of lending to borrowers with a high loan to income (LTI) ratio increased by 0.5 pp from the previous quarter to 45.8%, the highest since 2022 Q4, and was 3.1pp higher than a year earlier.
  • The value of new mortgage commitments (lending agreed to be advanced in the coming months) increased by 4.9% from the previous quarter to £69.3 billion, the highest since 2022 Q3, and was 50.7% higher than a year earlier.
  • The share of gross mortgage advances for house purchase for owner occupation decreased by 0.8pp from the previous quarter to 63.7%, but was 3.9pp higher than a year earlier.
  • The share of gross advances for remortgages for owner occupation increased by 0.7pp from the previous quarter to 23.5%, but was 4.8pp lower than a year earlier.
  • New arrears cases (as a proportion of total outstanding balances with arrears) increased by 2.3pp from the previous quarter to 12.0%, but remained 1.5pp lower than a year earlier.
  • The value of outstanding mortgage balances with arrears increased by 1.3% from the previous quarter to £22.1 billion, and was 8.4% higher than a year earlier. The proportion of the total mortgage loan balances with arrears, relative to all outstanding mortgage balances, has stayed the same as the previous quarter at 1.3%, and was 0.1pp higher than a year earlier.

10 responses from the Newspage community

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Tony Redondo
Founder at Cosmos Currency Exchange
Today’s Bank of England’s Q4 2024 Mortgage Lenders and Administrators Statistics read like a set of traffic lights. Green for a booming UK mortgage market with the total value of residential loans hitting a record since 2007 with gross advances at their highest level since Q4 of 2022. First-time buyers are driving demand with a record 29.6% share. Amber for soaring new commitments, up over 50%, and a big shiny red light for a 45.8% increase in high loan-to-income lending, the most since Q4 of 2022, signaling stretched affordability amid current mortgage rates and new mortgage arrears cases spiked to 12%. Is this a surge in confidence or a sign of job insecurity, concerns about the April tax rises, the economic headwinds, and a global trade war? FTBs and high-LTI borrowers could face increasing pressure if interest rates rise or economic growth falters.
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Pete Mugleston
Mortgage Advisor & Managing Director at onlinemortgageadvisor.co.uk
The latest mortgage data highlights a mixed picture for the UK housing market. The record share of lending to first-time buyers is encouraging, suggesting that improving affordability and lender competition are helping more people get onto the property ladder. However, the sharp rise in high loan-to-income (LTI) lending raises concerns about long-term affordability, particularly if interest rates remain elevated. While mortgage advances and new commitments have surged, growing arrears indicate financial strain for some borrowers. The market is showing resilience, but the increase in debt levels means careful monitoring is needed to ensure sustainable lending practices moving forward.
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Andrew Montlake
CEO at Coreco
This data is bittersweet. While it's great to see that share of lending to first-time buyers was at its highest since records began, almost certainly due to the looming stamp duty deadline, the increase in outstanding mortgage balances with arrears shows the red flags surrounding the economy and the extreme pressure on household finances. It's no surprise that lending to borrowers with a high loan to income was up as affordability remains a constant challenge for many. Luckily there are more lenders catering to this sector, including April Mortgages.
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Mark Eaton
COO at April Mortgages
Mortgage lending surged in the final quarter of last year as borrowers rushed to beat April’s stamp duty deadline.
Mortgage advances reached a two-year high, with the share of lending to first-time buyers hitting new heights.
However, with house prices soaring borrowers are increasingly reliant on high loan-to-income ratios to overcome affordability pressures.
There are also clear signs of mortgage stress with the total value of arrears spiking 8% in the last 12 months.
Urgent action is needed to tackle the current affordability crisis in the UK housing market and ease the burden on hard-pressed households.
We need to make it easier for responsible borrowers to access larger loan sizes and provide more tailored financial support to homebuyers.
If homeowners are worried about their mortgage repayments they should speak to their lender as soon as possible as there may be ways they can support you.
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Sean Horton
Managing Director at Respect Mortgages
First-time buyers are pushing themselves to the max to grab that first rung on the property ladder. The record share of first-time buyer lending alongside the spike in high loan-to-income borrowing tells a clear story. Yes, lower mortgage rates help with monthly payments, but as brokers, we're seeing more clients wanting to borrow at the very edge of what lenders will offer.
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Patricia McGirr
Founder at Repossession Rescue Network
Hooray. The mortgage market is booming. Just ignore the arrears, debt and future misery. Mortgage lending is at record highs, debt is soaring, and first-time buyers are signing up in droves. What could possibly go wrong? With £1.678 billion in mortgage loans floating around, lenders are rubbing their hands with glee while nearly 46% of borrowers are diving headfirst into high loan-to-income deals. Of course, the small matter of rising arrears (£22.1 billion and counting) shouldn’t dampen the celebrations. Who cares if borrowers are sinking under impossible repayments, as long as the lending machine keeps churning? The system isn’t broken, it’s just highly geared. In Britain’s mortgage market, debt is ‘growth', risk is ‘opportunity' and financial ruin is just a ‘market fluctuation’ away. I wonder what plans are in place to support borrowers who's decisions today might cause them problems later?
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Jamie Elvin
Director at Strive Mortgages
The latest figures from the Bank of England highlight a significant rebound in mortgage lending, with first-time buyers taking a record share despite ongoing affordability pressures. The surge in high loan-to-income borrowing suggests that buyers are stretching their finances further to secure a home, reflecting both renewed confidence and the challenges posed by higher property prices and mortgage rates. While the overall market looks strong, the rise in arrears is a reminder that some borrowers are struggling, particularly those coming off fixed-rate deals onto higher repayments.
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Michelle Lawson
Director at Lawson Financial
There are no surprises here. Interest rates have pushed mortgage costs up and people are left with little to no option but to take what is on offer as long as they meet the lender criteria. Borrowers are having to reconsider their budgeting and make adjustments accordingly and the increase in arrears is a reflection of the struggles many are facing to make ends meet.
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Emma Jones
Managing Director at Whenthebanksaysno.co.uk
This data shows that first-time buyers, in an effort to beat the stamp duty deadline, were particularly active in the final months of 2024. That the value of commitments was up 50% shows how frenzied the market was. This certainly ties in with what we, as brokers, were seeing on the ground. The one concern is the growth in mortgage balances in arrears, up over 8%. That shows the pressure households are under and the need for more rate cuts to alleviate the pain.
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Justin Moy
Managing Director at EHF Mortgages
Much of the recent activity will have been driven by the upcoming stamp duty threshold changes, with first-time buyers looking to complete purchases before the end of March. With property prices remaining high, FTBs are utilising schemes such as Nationwide's Helping Hand Mortgage to increase what they can borrow. Mortgage payments are, on average, 20% cheaper than renting a similar property in the local area, so ownership continues to be a priority for younger buyers, even with higher mortgage rates. The mix of mortgage business will change through 2025, as an expected lull in the market after those new Stamp Duty thresholds take effect and buyers will look for ways to claw back those extra costs.