Lenders are starting to increase their range of higher loan-to-value (LTV) mortgages, according to a report from Moneyfacts.co.uk.
Here are the report's key findings:
 | - Since the Bank of England base rate reached 0.50 per cent on 5 March 2009, the number of mortgage products requiring a minimum of 15 per cent deposit has risen from 169 to 231.
- The number of products requiring a minimum of 10 per cent deposit has risen from 89 to 105.
- However, we are not seeing the same trend in the cost of mortgages, with few providers cutting rates.
- The average two-year fixed-rate mortgage is 5.06 per cent at present, identical to July ’09’s figure, and up from 4.84 per cent eight months ago.
- The average two-year tracker rate is currently 3.76 per cent, compared with 3.86 per cent on 5 March 2009.
- The total number of residential mortgage products has grown from 1,431 to 1,564 products since March this year.
|
Higher LTVs Should Help First-Time Buyers
Darren Cook, spokesperson at Moneyfacts.co.uk, commented: "It is encouraging to see that lenders are becoming more accommodating with their deposit requirements, which should give more opportunities to first-time buyers to take advantage of a buyers' market.
"A few lenders have made cuts to their mortgage rates over the past few days, but these are too few to announce a formal return to healthy competition.
"It looks like lenders are trying to make an effort to increase their prudent appetite to lend, but we need to see more lenders trying to better each other on rates."
Winkworth Report Increased First-Time Buyer Demand
The findings from Moneyfacts.co.uk will be good news for first-time buyers, who, according to a report from Winkworth, are starting to return to the housing market.
A straw poll of UK Winkworth agents revealed that the average percentage of first-time buyer (FTB) enquiries fell by 55.8 per cent to 19 per cent in 2008.
The percentage of FTB enquiries has now returned to 32 per cent in spite of limited finance availability, with first-timers keen to take advantage of current house prices before they rise to peak levels again.
Josh Kravitz, Franchisee of Winkworth in Tottenham, where first-time buyers make up 40 per cent of market share, says: "There is a lot of demand at the moment and we have had a large increase in enquiries from first-time buyers this year.
"They are now confident that it's the right time to buy and have had the time to save for a deposit. The problem now is that there is a shortage of stock which doesn't meet the renewed demand."
Related story:
