Mortgage rates 'no help' to first-time buyers
Mortgage lenders are providing little incentive to those thinking of purchasing property, it has been observed.
According to Michelle Slade, analyst at Moneyfacts.co.uk, first-time buyers are likely to be put off by high interest rates and the need for a large deposit.
She explained that the average rate is over seven per cent - despite the Bank of England's base rate being one per cent - and many expect a 40 per cent deposit.
The price comparison site's figures refer to fixed-rate mortgages, which make up three-quarters of the deals targeted at those looking for their initial home.
In addition, Ms Slade remarked: "The risk of customers buying a property and falling straight into negative equity is much higher than a year and a half ago."
Those hoping to live in London may wish to consider renting a house or flat instead in light of the comments, particularly as real estate firm Jones Lang Lasalle told the Times that prices could drop a further 20 per cent this year.
Published 26th February, 2009
© 2009 Estates IT Limited
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Mortgage lenders are providing little incentive to those thinking of purchasing property, it has been observed.