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FTBs push mortgage market towards recovery

FTBs push mortgage market towards recovery

Category: Mortgages

Updated: 12/04/2010
First Published: 12/04/2010

MONEYFACTS ARCHIVE
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Home buyer confidence in the property market continues to gradually grow, thanks to more affordable house prices and cheaper mortgage rates, it has been revealed.

Principality said the number of borrowers taking out a mortgage in the first three months of 2010 had almost trebled compared with the same period last year.

The Welsh building society added that February witnessed its biggest volume of mortgage applications since November 2007, prior to the onset of the credit crunch.

The news follows last week's decision by the Bank of England to keep interest rates on hold at 0.5%, another slice of good fortune for borrowers.

"These figures are a good sign of the gently recovering confidence in the housing market," said Graeme Yorston, chief operating officer.

"The average mortgage rate has been steadily decreasing since the middle of last year and this, coupled with more affordable house prices, has encouraged a healthy mix of buyers."

According to the society's figures, around one in five (21%) mortgage applications received since the start of 2010 were from first time buyer.

"Any sustainable recovery in the market is dependent on movement from both first and next time buyers.

"The dual benefit of reduced house prices and mortgage rates, makes buying more appealing than renting, but tightened mortgage criteria and the requirement for a much larger deposit, is continuing to present barriers for those trying to get their foot on the ladder."

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