View more on these topics

Comment: A homeless elephant in the room?


It is still hard to see how the Government will meet its target of two million first-time buyers by the end of this Parliament

The outlook for first-time buyers appears to be the brightest of all borrower segments right now.

Our latest research found brokers and lenders agreed that the first-time buyer market would steer ahead of homemovers, remortgagors and other segments in terms of growth opportunities.

We published a white paper earlier this year showing mortgage affordability had hit a new high thanks to the cheaper deals available and, to top it off, first-time buyer mortgage repayments were lower than average rents in every UK region. So why on earth are would-be first-timers still renting?

Quite simply, there is much more to be done, not least in pressured areas such as London and the South-east. Mortgages may be cheaper but higher deposits due to higher house prices are holding back buyers. Once again, this draws attention to the elephant in the room: a very real housing shortage. And let us not ignore the possibility of rent rises resulting from continuing buy-to-let reform, which could propel landlords to hike rates.

We await the Redfern Review for the latest number of homes needed every year to keep up with demand, and a more thorough investigation into what is holding back first-time buyers.

With the Starter Homes scheme still stuttering into life and the planned cessation of Help to Buy 2 at the end of this year, it is still hard to see how the Government will meet its target of two million first-time buyers by the end of this Parliament.

Peter Williams is executive director of the Intermediary Mortgage Lenders Association



GE Money stops lending following loan book sale

GE Money Home Lending has stopped lending after its parent company completed a deal to sell off the rest of its loan book. Parent GE Capital put the specialist lender up for sale in April, saying it wanted to concentrate on its industrial and manufacturing businesses. GEC has sold a £4bn book to a consortium […]


Nationwide eyeing launch into equity release sector

Nationwide is eyeing a launch into the equity release sector. Speaking to the Times, the UK’s second biggest lender said it had been looking at ways to allow older borrowers to release equity in their homes to allow them to help their children get on the housing ladder or to pay for care. Chief executive […]


Barclays set to increase B2L rental coverage ratio

Barclays is set to become the latest lender to increase its rental cover requirements. From 26 May, the lender will increase its rental coverage ratio from 135 per cent to 145 per cent. However, the lender will continue to carry out an income and expenditure assessment to see if borrowers can use their earnings to […]


News and expert analysis straight to your inbox

Sign up