Government must help first-time buyers, expert says.
More needs to be done by the government in terms of assisting prospective first-time holders of home loans such as .That is the opinion of Katy John, press officer at online resource Priced Out, who f…
More needs to be done by the government in terms of assisting prospective first-time holders of home loans such as .
That is the opinion of Katy John, press officer at online resource Priced Out, who feels the administration could be more proactive in its efforts of helping people obtain mortgage products when they are trying to get their feet on the property ladder.
Ms John called on the Conservative-Liberal Democrat alliance to “focus on the longer-term objectives of building more houses” while also “continuing with its planning reforms to free up more land to build on”.
However, she added that mistakes made in the last property pricing boom prior to the global economic downturn must be avoided.
These comments came after the publication of new research by the Council of Mortgage Lenders earlier this week (September 12th), which showed that that the number of home loans approved to first-time buyers decreased by two per cent in July.
In related news, an expert has identified the need for new pioneering schemes to assist people in their quest to secure a home loan such as a tracker mortgage for the first time.
According to Helen Adams, managing director at online resource First Rung Now, individuals striving to get their feet on the mortgage ladder in the wake of the recession need to be offered more help from banks and building societies.
Ms Adams noted that while some financiers are understandably “reluctant” to provide capital to first-time buyers following the economic slump due to their decreased profit margins, fresh owners are needed to stimulate the housing market as a whole.
“Although property prices may stagnate or come down a little bit, prices are still very high and we do need some innovation in this sector,” she added.
This comes after research by Halifax showed that the proportion of disposable earnings devoted to mortgage payments fell to its lowest level in 12 years during the second quarter of 2011.
Meanwhile, a lack of fluidity in the mortgage market is forcing prospective borrowers into an expensive rental market, an expert in the industry has said.
Katy John, press officer at online resource Priced Out, feels that such people are currently stuck between a rock and a hard place, as neither signing up for products such as tracker mortgages or leasing a house are cost-effective options.
Research published recently (August 29th) by Halifax revealed it is now £110 a month cheaper for a first-time buyer to purchase a home than rent.
This represents a significant shift in comparison to previous years as, for example, it was £212 per month more expensive to buy than rent in 2008.
And Ms John went on to explain that while the private rented market remains both the least affordable and secure housing sector, first-time buyers are also struggling as a result of the “shortage in supply, high house prices and the requirement to save up a large deposit”.