First-time buyers 'still face financial hurdles'
While low mortgage rates are likely to be welcomed by first-time buyers, one sector commentator has warned them to prepare to face other financial hurdles on their journey to becoming homeowners.
Recent research by moneysupermarket.com revealed that more products are now available to mortgage buyers.
Deals with an 85 per cent loan-to-value rate have seen the greatest rise in availability since December 2009 at 22 per cent - which means there are now 384 products available to buyers with a 15 per cent deposit.
Commenting on the news, Paul Holmes, chief executive officer of Firstrung, said this would "undeniably" be good news for buyers, as it would be easier to come up with such a deposit than one which was valued at 25 to 40 per cent of the property's price.
"So it helps, but it is still narrowing the sample of first-time buyers that can actually climb on that first rung with a 15 per cent deposit," he added.
Mr Holmes explained many of the first-time buyers his firm spoke to could only afford a five to ten per cent deposit, while couples were likely to have a combined average income of £35,000 to £40,000.
This is far below the typical UK property price of £160,000.
Such comments may inspire Britons to consider flats to rent in Kensington or elsewhere in London which they could use as a base while they save for their first home.
Written by Martyn Glynn
Published 28th January, 2010
© 2010 Estates IT Limited
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There are more financial hurdles than just mortgages to content with before first-time buyers can begin climbing the property ladder, one sector commentator has claimed.