According to a report from the BBC this week there has been a drop in mortgage lending to first time buyers, and mortgage brokers believe that this likely reflects a drop in confidence among potential buyers. The article points to data from the Council of Mortgage Lenders (CML) which revealed that the number of loans approved to first time buyers was 26,800 in September, representing a 3% decrease compared with the previous month’s figures. However despite this, they were quick to point out that these figures are still much higher than the same period last year.
The Telegraph also revealed this week that the number of first time buyers also fell in September this year. This is thought to be related to the fact that banks are charging first time buyers a penalty of £2,800 a year ( the highest since records began in 1995) for putting down smaller deposits, leading to a decline in the number of first times buyers getting onto the property ladder.
There are also indications that changes in the housing market may be more widespread. According to the Financial Times, data has shown that lending to home buyers more generally also decreased by 7% in September to 58,000 loans, suggesting that the mortgage market may be cooling.
The article quotes Director General of the CML as stating that “Fears that the market is going to keep on overheating have rather gone away. The market seems in a much more stable pattern at the moment. I think what a lot of people are thinking about is that the next move in interest rates is going to be up, so there is perhaps a bit of caution around about people overextending themselves.”
This news is the latest in a series of indications suggesting that the housing market may be cooling down after a period of relative boom earlier this year, which had led to fears we may be on the brink of a property bubble.
Whether you are a first time buyer or the owner of an existing property, here at Search Mortgage Solutions we can help. Our Leeds-based mortgage advisors are mortgage experts and can help you find the right mortgage for you to meet your individual requirements. So if you’re looking for a mortgage broker in Leeds please do not hesitate to contact us and a member of our knowledgeable team will be happy to help you with your enquiries.
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