The number of mortgages completed for house purchases taken out by both first-time buyers and home movers reached 220,750 in quarter four, 18 per cent higher than Q4 2019, the latest lending figures from UK Finance show.
The split between home mover and first-time buyers loans was 117,080 and 103,670 respectively. In 2019, the volume of loans issued to both sets of buyers was more evenly balanced with 94,100 mortgages issued to home movers and 92,690 to first timers.
The rush to benefit from a stamp duty saving of up to £15,000 because the nil rate threshold was increased to £500,000 until March 31 meant Q4 was the busiest quarter for mortgage lending since 2007.
In yesterday’s Budget the stamp duty holiday was extended until June 30 after which the nil rate threshold will be lowered to £250,000 until the end of September. From October the £125,000 threshold will resume.
December’s home mover volumes of 41,910 were last exceeded in November 2007 when 50,440 loans were issued to buyers who have previously owned a home.
But due to the shutdown of the mortgage market over Q2 when the pandemic forced the country into its first lockdown, annual residential mortgage volumes of 612,000 were 12 per cent lower than 2019.
Eric Leenders, managing director, personal finance, said: “The stamp duty holiday helped to boost activity at the end of 2020, and it is likely many of these purchases have been brought forward in order to take advantage of the savings.
“The chancellor’s announcement in the Budget to extend the Stamp Duty holiday until the end of June before then phasing it out will prevent a cliff edge, reducing the risk of house sales collapsing and will prove beneficial for all parties involved in the housing market.”