Mortgage news
HOPE ON THE HORIZON FOR FIRST TIME BUYERS?
Amongst the gloomy economic press, there may be a glimmer of light for first time buyers with the release of recent information regarding the property and mortgage market.
1. The proportion of first time buyers looking to put a foot on the property ladder more than doubled in the first 2 weeks of 2009 according to the National Association of Estate Agents, which could mean that confidence is returning in this sector of the market.
2. The release of the latest house price index by the Halifax showed a rise in house prices of 1.9% in January, the first increase since February 2008. However, Nationwide reported a fall of 1.8% in February with the typical price of a house down to £147,746 and comments that sharp cuts in interest rates have helped affordability.
3. Northern Rock plans to increase its mortgage lending with up to £14bn in new loans by 2011, and could return to the 90% LTV market, this has been hailed as a positive step for the market by The Council of Mortgage Lenders.
4. The announcement by RBS group that they are to commit to lend a further £9bn worth of mortgages over and above planned levels during 2009 should boost liquidity and bring further price competition to the mortgage market.
Whilst no one can predict what will happen next, house prices have become more affordable and the above may be signs that the market is beginning to stabilise, so now may be the time for first time buyers to take the next steps to get onto the property ladder.
Why rent when you can buy? Many first time buyers believe they cannot afford to buy - but it is realistic in today's market that you can own a property at a similar cost to renting. If you are currently renting at the moment paying circa £500 per month in rent, for similar monthly payments you could buy a property worth in the region of £95,000 based on a typical first time buyer mortgage with a 10% deposit.
With mortgage lenders having become more cautious and with products being introduced and withdrawn far more frequently, it is now more important than ever that prospective first time buyers seek the advice of an independent mortgage broker.
All customers will have different priorities that they consider when arranging a mortgage, and what is deemed important by one customer may not be by another. An independent broker will search across the market to find the most appropriate product, and will provide impartial advice based around those specific requirements, recommend the most suitable product and manage the process on behalf of the customer from application right through to completion and beyond, keeping the customer fully informed throughout.
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