Vesta Packaging has slammed lenders for failing to restart the first-time buyer market by sticking to outdated income multiples and mortgage terms.The company says stable house prices mean now is an ideal time for aspiring first-timers to re-enter the market. Vesta managing director Mark Leaper says the best ways to kick-start the market are to give first-time buyers the chance to raise mortgage advances and to keep mortgages affordable. He says lenders should increase multiples by offering at least seven times income and extend mortgage terms to 40 years plus. If they did this, he says, the UK could align itself with much of Europe and advances would reflect the market value of even the most basic properties. Leaper also says LTVs should also be pushed above 100% in a way similar to Northern Rock’s Together product. Leaper adds: “There won’t be a large house price drop such as the one in the early 1990s. Instead, there will be a long period of stable house prices – an ideal opportunity for first-time buyers to rekindle the market. The only problem is the multiples and terms most lenders are offering are relics of the past. “Four times income and 80%LTV might have worked in 1980 but there is no way it works today. Lenders must be more adventurous.” He claims there is pent-up demand for FTB products, saying Vesta has been snowed under with enquiries on a recently-launched 7.5 x single income product, and is also under pressure to provide more deals that offer 35-year terms and 125% LTVs. He adds: “We have a chance to rekindle this market and must not squander it because of a lack of imagination on the part of lenders.”
Industry pundits says that today’s rate hold came as ” surprise.”Duncan Pownall, mortgage development manager for Bradford & Bingley, says: “Even though the MPC cut base rate last month, only five out of the nine policymakers,excluding Mervyn King, voted for the reduction. “Indeed with the jump in the inflation rate, rising oil prices and signs […]
Mortgage Trust says 64.7% of buy-to-let mortgage brokers believe that the changes allowing residential property to be held in self invested personal pensions will boost the buy-to-let market. Intermediaries surveyed in MT’s September Buy-to-Let Intermediary Forecast predict the changes would lead to an uplift in buy-to-let business volumes of 10.6%. Some 70% of respondents plan […]
Goldsmith Williams, the direct conveyancing firm, has teamed up with the Personal Finance Society, the professional body for financial advisers, to offer its 25,000 members the opportunity to benefit from discounted legal services.As well as a remortgage rate of 325 inclusive of VAT and disbursements for completed remortgages, PFS members will also be able to […]
The Royal Institution of Chartered Surveyors has slammed the Governments proposal on planning for housing provision, as making hot markets even hotter rather than more affordable. The Government has proposed local authorities build up 15 year land banks so they can quickly allow land to be released for building houses when local markets rise so […]
As the auto-enrolment revolution is rolled out to companies with between 50 and 249 people, employers will be grappling with the new rules and requirements. Even though introducing the new regime can be time consuming, many employers are regarding it as an opportunity to review their benefits packages, with employee health and wellbeing regarded as a popular addition.
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