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Residential Mortgage loans difficult to secure for second time buyers
Residential Mortgage loans difficult to secure for second time buyers
It has been reported by Lloyds TSB that second time buyers face the most difficult conditions the industry has seen for over 25 years.
Maidenhead,
Berkshire,
United Kingdom
(sardnews.org)
01/10/2012
It has been reported by Lloyds TSB that second time buyers face the most difficult conditions the industry has seen for over 25 years. Home affordability is at its worst, more so than for first time buyers, and with first time buyers unable to get their foot on the property ladder and kickstart the property industry, conditions are increasingly hard for those looking for a second home.
Those planning on buying their second home are facing difficulties due to their equity position, which accounts for just 5% of the price of a typical second stepper home compared with 44% in 2005. In addition, second time buyers account for the smallest share of home buyers for over ten years.
The average buyer deposit in 2012 was £61,536, which is a rise of 70 per cent from the average of £36,280 in 2002, making home affordability for this group of buyers almost five times gross annual average earnings which is the highest ratio since 1988.
The challenges for second time buyers are toughest than they have been for more than a generation following the fall in house prices over the last five or six years, not helped by the chipping away of equity among those who bought for the first time at close to the peak of the market.
This has created a bottleneck situation, limiting the available homes for those who want to move up the property ladder due to needing more space for growing families.
Richard Alton runs Alton Mortgages, a whole or market broker based in Maidenhead. Established in 2005, customer service is at the heart of what they do, and they recognize that their clients are individuals with very unique requirements. He says:
"Home movers are the life-blood of the housing market, as they feed both the top and the bottom of the market in the chains they create. As a business our experience has been different to this in that 2nd time buyers have a decent deposit built up and income used is on average just over 4 times (not the 5 times reported by Lloyds).
"From our view point the home mover market has been very busy over the last few months with people generally making the most of the spring until September time market to move house. We have also seen a trend in people renting out their current home (with lender permission) and buying a second property. Some people are concerned about relying on a pension scheme that is linked to a very unpredictable stock market but what I can say is that some very canny people are making excellent investment decisions for their long-term futures."
Notes to Editors
Alton Mortgages is an established whole of market mortgage broker based in Maidenhead, Berkshire. Established in 2005, customer service is at the heart of what we do, and we recognize that our clients are individuals with very unique requirements. Click here to find why you should use a broker . We work with individuals and families to provide them with an exceptional residential mortgage service. Click here to find out more about Alton Mortgages
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About Alton Mortgages Ltd
Alton Mortgages is an established whole of market mortgage broker based in Maidenhead, Berkshire. Established in 2005, customer service is at the heart of what we do, and we recognize that our clients are individuals with very unique requirements.
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