The Council of Mortgage Lenders in Northern Ireland found that 2,500 house purchase loans, worth £240m, were advanced in Q4 2011, up 4% on the previous quarter and 4% year-on-year.

UK-wide, lending for house purchase fell 5% by volume and 7% by value in Q4 2011 compared to Q3, but grew 1% by volume and 3% by value year-on-year.

The number of remortgage loans taken out in Northern Ireland totalled 1,800 in Q4, down 10% from the previous quarter, but up 20% from Q4 2010.

Meanwhile, first-time buyer loans in Northern Ireland remained static at 1,400 from Q3 2011 to Q4, while the value of the loans rose to £120m in Q4, up from £110m in the previous quarter.

For 2011 as a whole, 4,900 loans were advanced to first-time buyers in Northern Ireland, worth £400m, compared to 4,700 loans worth £430m last year.

Sponsored

Aldermore Insights with Jon Cooper: Edition 9 – Why lending strategy is becoming more central in buy to let

Sponsored by Aldermore

Derek Wilson, chair of CML Northern Ireland, said: “The increase in house purchase loans is a much needed confidence boost to the market in Northern Ireland. The lack of job security and underlying economic uncertainty has led to a lack of demand for mortgages, particularly among movers.

“We need to try to combat the general feeling of negativity and to promote the value of the wider property market to the economy encouraging confidence to breed confidence.”

Karl Allen, director of Northern Ireland-based financial adviser Money Matters, added: “The CML data hints that frozen demand may finally be thawing out.

“This is not down to any sudden relaxing in lending criteria, but rather a gradual process of people who are either renting or who have delayed their buying decision, now reaching a tipping point.

“Many first-time buyers are realising that it is cheaper to buy than to rent. In some parts of Northern Ireland, house prices are down 40% on their peak levels and many believe that the market now offers exceptional value.”