26
Feb
Mortgage situation 'worsening' for first-time buyers
Taking the first steps up the property ladder is becoming
increasingly difficult for British consumers, it has been
suggested.
In a report by financial portal Fool.co.uk on the increasing trend
for mortgage lenders to charge higher interest rates for borrowers
who only have small deposits, first-time buyers are described as
"the biggest losers".
This is because those starting out in the market usually do not
have large deposits, the site suggested.
It added that it was "painfully ironic" that lenders are making it
more difficult for first-time buyers to acquire finance at a time
when property prices are finally becoming more affordable.
Commenting on the current market situation to the Guardian, Savills
Private Finance's Melanie Bien said: "First-time buyers are going
to find it a lot tougher and anyone who misses even one monthly
payment is going to be flagged up as a risky borrower."
Following the publication of British Bankers' Association figures
this week that showed record levels of remortgaging activity in
January, Simon Rubinsohn, chief economist for the Royal Institution
of Chartered Surveyors, also suggested there might be tough times
ahead for first-time buyers.
He said that the figures show lenders are more willing to pass on
base rate reductions to those already owning property, while
first-time buyers are struggling to find finance.
"It does however throw into sharp relief the claim that a weaker
housing market will necessarily be good news for first-time
buyers," Mr Rubinsohn said.
