Large mortgage deposits could lead to people looking for flats to rent in London
There may be a rise in the number of people looking for flats to rent in London as it has become increasingly difficult to secure a first mortgage, according to one expert.
Editor of What Mortgage Ben Wilkie said the market will not return to a position where it can offer 100 per cent loan-to-value (LTV) mortgages in the near future.
He claimed there is a real danger for first-time buyers if lending does not increase above the 90 per cent mark, which may lead to people renting flats in London as an alternative to buying property.
Mr Wilkie noted an individual would have to save at least around £20,000 in order to cover the cost of a deposit plus additional fees.
"That is a huge amount of money for a lot of people - especially if you have got things like student loan debts and that sort of thing," he stated.
Earlier this month, e.surv reported the biggest fall in LTV's for a year, as they dropped to 57.2 per cent in September, compared to 58.1 per cent for August.
Andy Britten
Published 12th October, 2010
© 2010 Estates IT Limited
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It has become increasingly difficult for first-time buyers to secure a mortgage, according to one expert.