Market movements push renter numbers up

14 2008
Young professionals are choosing to stay in rental accommodation for the time being as mortgage lenders tighten their belts in the wake of the global credit crunch.

While in the past prospective first-time buyers may have been encouraged to take out mortgages in excess of 100 per cent of the value of a property, such deals are becoming harder to come by, leading growing numbers of people to remain in the rental sector.

According to the mortgage lender Charcol, which gave out no 100 per cent-plus loans in January, even though average house prices have dropped slightly over recent months, there is still some way to go until people will be able to easily get onto the property market.

Katie Tucker, the company's technical manager, explained: "The scarcity of 100 per cent-plus mortgages available at all on the market combined with consumer fear of negative equity in the current property market has bought the average loan to value down considerably as many first time buyers with little or no deposit, have stopped to think again.

"Property values would need to fall far enough that starter homes become bargains, at the same time as interest rates fall, before first time buyers can afford to buy comfortably again."ADNFCR-1219-ID-18467837-ADNFCR

Related Articles
Mayfair home falls down in credit crunch
A £20 million London property has become the latest victim in the...

House prices have 'no reason' to stabilise soon
The idea held by many that Britain's house prices will steady as a result...

Which? publishes help for 'accidental landlords'
Consumer organisation Which? has created a book to aid landlords in the...

Private landlords 'should be encouraged'
The private rental sector should be supported and expanded, and buy-to-let...

Annual price drop reaches 8.1%
A relatively modest annual price drop has been recorded by Hometrack this...