October 11th, 2010
A Bradford-based lender remains on track to double its mortgage business this year compared with 2009.
The Yorkshire Building Society expects to lend around £2 billion this year as demand from first-time buyers, those moving home and people changing lenders remains on target.
A raft of market-leading loans, including the re-introduction of 90 per cent mortgages, has helped YBS to maintain demand at a time when the housing market has slowed and a new report says it could take a decade to breathe new life back into the market.
The report warns that first-time buyers struggling to save a deposit could be excluded from the property ladder for a decade.
The findings by insurer Grenworth Financial said the number of mortgages taken out by people with only a ten per cent deposit, typically associated with first-time buyers, slumped from 245,000 in 2006 to just 28,000 in 2009, an 89 per cent fall.
But Tanya Jackson, corporate communications manager at Yorkshire Building Society, said: “During the period covered by the survey 90 per cent loan to value mortgages were generally not available, so the findings do not reflect the full picture.
“We only re-entered the 90 per cent loan market earlier this year and demand has been steady and not just from first time buyers. We are also getting applications from people looking to change lenders and those moving house.
“We’ve had some very competitive products available which have enabled us to maintain demand and we remain on target to achieve a doubling in our lending business this year.”
Grenworth Financial said the decrease in mortgage applications suggested that 100,000 first-time buyers were excluded from getting on to the property ladder in each of the three years reviewed.
With house prices still high in relation to earnings, a buyer putting together a deposit of ten per cent of their home’s value would have to save the equivalent of £18,600.
The group called for the changes so that people are not excluded from taking out a mortgage if they do not have a substantial deposit.
Source: Telegraph & Argus