9
Jun
Mortgage lenders' restrictions 'to blame' for market woes
Mortgage lenders rather than interest rates are to blame for the
troubles in the housing market because of the increasing
restrictions they are placing on home loan deals, Moneyextra.com
has claimed.
According to its latest monthly review of the mortgage market, the
average loan-to-value (LTV) ratio being considered by first-time
buyers last month was just unfer 82 per cent.
However, it notes that many lenders are now restricting borrowers
to loans of no more than 75 per cent, while some will only offer
their most competitive rates to those need an LTV of 60 per cent or
less.
The website stated that the average property value being searched
for on its website by first-time buyers in May was £170,236 -
an LTV of 75 per cent on that sum would require the borrower to
find a hefty deposit of £42,559.
Robin Amlot, senior editor of Moneyextra.com, commented: "It's all
but impossible for many potential buyers to find a lender because
of the size of deposit they're being asked to provide."
Recently the price comparison website found that the price
first-time buyers are prepared to pay for a property has fallen
significantly in recent months, from a peak of £190,040 in
December 2007.
