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Government Help

First-timer buyers need more help

Adam Williams
Written By:
Posted:
17/09/2015
Updated:
09/03/2017

With house prices continuing to rise, the government must do more to support the first-time buyer market.

Figures from the Office for National Statistics (ONS) released this week showed that house prices are continuing to rise, albeit at a slower pace than before.

Patrick Bamford, director of mortgage insurance for Genworth, said that while the overall picture was improving, the government needed to act to help first-time buyers

“A lack of access to affordable mortgages continues to hit hopeful first-time buyers as limited lending through high loan-to-value products endures,” he said.

“Help to Buy has encouraged greater availability of products for those with deposits of just 5% or 10%, yet take-up remains restricted. These restrictions compounded with rising house prices and a lack of supply means first-time buyers are still typically putting up a 20% deposit: a monumental hurdle to overcome before stepping onto the property ladder.”

While the ONS found house price growth was its slowest in more than two years, borrowers with a small deposit still face significantly higher rates.

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This has left many wannabe buyers reliant on parental support, Bamford added.

“Even improved pricing of loans is not enough to counter the trials first-time buyers face. Although the price gap between 75% and 95% loan-to-value mortgages has narrowed, all but the wealthiest – or those with support from the Bank of Mum and Dad – still face far higher costs, squeezing monthly budgets.”