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Highlights
- The UK housing market witnessed a surge in the number of first-time buyers in 2021. Many individuals took their first step in the property market through mortgage funding.
- As per the experts, multiple positive factors have contributed to the surge in first-time buyer numbers, including record-low mortgage rates and solid growth in the job market in the country.
The UK housing market witnessed a surge in the number of first-time buyers in 2021. Many individuals took their first step in the property market through mortgage funding. In 2021, nearly 50% of the housing transaction were done by first-time buyers, with mortgages moving up from 36% in 2007.
As per the new analysis done by UK Finance and Yorkshire Building Society (YBS), the first-time mortgage buyers’ number crossed the 400,000 mark in 2021, the highest number since 2006 when the figure was at 400,900.
As per the experts, multiple positive factors have contributed to a surge in first-time buyer numbers, including record-low mortgage rates and solid growth in the job market in the country, helping the buyers take the first step onto the property ladder. However, the elevated level of first-time buyers’ number is expected to decline in 2022 and beyond amid high housing prices in comparison to the individual earnings, which could reduce the number of first-time buyers.
© 2021 Kalkine Media®
Let us look at 3 FTSE listed stocks mortgage companies and their investment prospects:
OSB Group Plc (LON: OSB)
FTSE250 listed company provides mortgages to commercial and retail clients in the UK and other countries. Besides lending, the company also provides savings products, mortgage servicing, and credit consultancy.
The company’s business delivered strong organic growth in the first nine months of 2021. The underlying net loans increased by 8% to £20.6 billion during the period. As the investors wait for the full-year results, the company is on track to deliver its full-year target of 10% growth in net loan book and underlying net interest margin (NIM) of 270bps.
OSB Group Plc’s last close was at GBX 554.50 on 31 December 2021, with a market cap of £2,487 million.
Lloyds Banking Group Plc (LON: LLOY)
The UK-based lender provides retail and commercial banking services to its clients across its diverse brands in the UK and other countries.
The lender reported a recovery in the number of loans approvals and net interest income in the first half of 2021, resulting in statutory profit after tax of £3,865 million. The company has given positive guidance amid improvement in the UK economic outlook for upcoming years.
Lloyds Banking Group Plc’s last close was at GBX 47.80 on 31 December 2021, with a market cap of £33,944 million.
Mortgage Advice Bureau (Holdings) Plc (LON: MAB1)
The company provides mortgage advice services in the UK. It advises on buy-to-let products and has a strategic alliance with key groups.
For the six months ended 30 June 2021, the company reported revenue of £92.4 million with a gross profit of £24.6 million. The gradual growth in the mortgage lending activities would have some bearing on the company’s revenue and profitability.
Mortgage Advice Bureau’s last close was at GBX 1,450 on 31 December 2021, with a market cap of £771.47 million.
