Rising deposits likely to lead to rental demand surge |
08 2008 |
| Demand for rental properties across the country looks set to increase after yet another lender announced that it is to take mortgages aimed at first-time buyers off the market. As banks and building societies take action to protect themselves against the global credit crunch, the UK's third-biggest lender Abbey has confirmed that it will no longer be offering 100 per cent mortgages. This means that the average first-time buyer will now be required to save almost £7,500 for a five per cent deposit on the £148,000 typical price of a property. As well as this, they will have to pay almost £1,500 in stamp duty and also hundreds of pounds in legal fees, prompting many to choose to stay in the rental sector until they can comfortably afford such an amount. Commenting on the market developments, Melanie Bien, director at Savills Private Finance, told the Times: "The liquidity squeeze is encouraging lenders to opt for low-risk business over higher risk, and that means attracting lenders with big deposits or significant equity in their home at the expense of those without.  |
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