Although it has been predicted that mortgage lending may increase next year, first time buyers are not likely to feel any immediate benefit, according to housing specialist Savills. This will not come as any comfort to freelancers looking for their first contractor mortgage.
Lucian Cook, director of residential research at Savills, explained that home owners benefit from an affordability advantage that is not open to first-time buyers.
Mortgage deposit requirements are high and first timers are struggling to accumulate the requisite amount. The majority of mortgage lending institutions still want large deposits, and those that don’t, charge a premium when they grant a home loan.
The RICS has said that house prices will stabilise as demand exceeds supply in 2011. A further drop in prices is expected in the first few months of the year but this should level off by the spring and by the end of next year, prices should start creeping upwards again.
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