UK mortgage market is moving again

Published 10th Jun 2011

After countless tales of impossible lending criteria and entry-level buyers being locked out of the market, it seems competition and good deals are finally coming back to the UK mortgage industry, with the major banks cutting interest rates and LTV ratios and first-time buyers responding positively.

The latest housing market report by Connells Survey and Valuation shows a 22% increase in the amount of mortgage valuations taking place for residential property, with a particular jump in the amount of first time buyers looking into getting a mortgage. Far from the recent media claims that home ownership in the UK is virtually a dead concept for the next generation, the report shows that first time buyers make up 34% of all market activity, and that there were 26% more valuations conducted for this category of buyer than the same period a year ago.

The report attributes this increase to the gradual easing of lending conditions on the UK mortgage market, as banks cut their fixed rate deals and offer better LTV ratios in a bid to attract more entry-level buyers. State-owned lender Northern Rock began offering 90% finance deals again in March, while major banks such as Barclays and Nationwide have cut interest on their two year fixed-rate mortgages down to 2.98% and 3.49% respectively. The Co-operative Bank's two-year fixed rate deal is even cheaper, with its intermediary lender Platform offering 2.69% interest with an LTV of 70%.

"Many first time buyers have been encouraged to enter the market by the uptick in the number of higher LTV products available recently", said Colin Dorman, business development director at Connells Survey and Valuation. "Housing market activity has resumed its slow and steady upward trajectory."

Source: ' TMC '

View All Latest News