CML announces high FTB income multiples

Income multiples for first-time buyers (FTBs) are currently at the highest level on record, according to the Council of Mortgage Lenders (CML).

The organisation reports that the average FTB was paying 3.21 times their income to take up a mortgage in June.

This is a marginal increase from the multiple of 3.2 recorded last month and a rise from the 3.06 level that was measured in June 2005.

Despite the fact that FTBs appear to be paying more than ever before to take up a mortgage deal, the CML states that the number of loans taken out by these customers increased by 14 per cent, from 34,800 in May to 39,500 in June.

This is the highest number of FTBs recorded since December 2002, when 44,000 people bought for the first time, and accounts for 36 per cent of all new mortgages.

CML director general Michael Coogan commented: “It is interesting to see that even though average first-time buyer income multiples are the highest on record, first-time buyers are still finding ways of getting on to the property ladder.

“It is highly likely that more and more young buyers are turning to parents and grandparents to help them raise the deposit for their first home.”

The CML figures also revealed that 38,800 tracker mortgages were taken out in June – an increase from 30,000 in May, while the number of fixed-rate offers declined from 143,200 to 140,600.