Green Shoots of Recovery for First Time Buyers in the Mortgage Market

CHESTER, England, July 20, 2011 -

• Number of mortgages available for those with a 10 per cent
  deposit at highest levels since November 2008
• Average rates on 90 per cent mortgages down 0.53 per cent in
  one year

First time buyers and borrowers with smaller deposits are
enjoying the first signs of recovery in the UK mortgage market,
with the number of products available for those with a 10 per cent
deposit rising to the highest levels since November 2008, according
to analysis by href="www.moneysupermarket.com/mortgages/">moneysupermarket.com.

There are now 312 mortgage products at 90 per cent loan to value
(LTV), an increase of 17 per cent since June. The last time there
were was over 300 products available was in November 2008, when
Bank of England base rate was at 4.5 per cent and the impact of
credit crunch began to have a major impact on mortgage lending.

As well as an increase in the number of mortgage products
available, the average rate on 90 per cent mortgages has also begun
to fall. The average rate on fixed rate mortgages has dropped 0.53
per cent in the past year to 5.87 per cent this month - and has
dropped 0.17 per cent since last month. Although tracker mortgages
at 90 per cent LTV are now more expensive than this time last year,
the average rate is now 5.5 per cent, a drop of 0.22 per cent since
June.

Clare Francis, mortgage spokesperson at href="www.moneysupermarket.com/mortgages/">moneysupermarket.com,
said: “There is a severe shortage of first time buyers at
the moment and one of the reasons for this is down to the fact that
it’s been so difficult to get a mortgage unless you’ve had a
deposit of 25 per cent or more. It’s therefore encouraging to see
an increase in the number of 90 and 95 per cent mortgages
available.

“That said, we are still a long way off the number of products
that were available pre-credit crunch and those with smaller
deposits are still having to pay a higher rate of interest than
those who are able to put down 25 or 30 per cent. It’s good to see
things are moving in the right direction though as this should make
it slightly easier for people to take that first step onto the
property ladder.” 

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For further information, please
contact:

Paul Lawler
PR Manager (Financial Services)
+44(0)1244-370317
href="mailto:paul.lawler@moneysupermarket.com">paul.lawler@moneysupermarket.com
 

Clare Francis
moneysupermarket.com
+44(0)1244-370317
href="mailto:clare.francis@moneysupermarket.com">clare.francis@moneysupermarket.com

.