Mortgages -
Fall in Mortgage Products Good For First-Time Buyers - 01/04/2008
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In spite of the negative overall impact of the current financial crisis, it has been revealed that first-time buyers may gain from it.
With the current fall in the number of mortgage products in the market, there will be fall in house prices, making it cheaper and easier for first-time buyers, Firstrung has said.
Operations Director at the firm which specialises in advising first-time buyers, Paul Holmes, said house prices are likely to drop given the reduction of cheap and easily obtainable credit.
Mr Holmes said he foresees house prices dropping by 20 per cent in the next two years as mortgage market reels from the impact of credit crisis
He advised first-time buyers who think they have got a bargain to go ahead and seal the deal by buying it, adding that: “If not, they’ve waited this long so where’s the harm in sitting out the market a little bit longer and watching as this drama unfolds?”
A good option for such consumers, he suggested, was to look out for house builders who had over-developed and were looking for clientele. This, according to him, could lead to cheaper deals on property.
On the contrary, recent reports have indicated that all categories of borrowers are bound to suffer as credit crunch rages and more mortgage deals are disappearing.
Last week Alliance and Leicester announced that it was withdrawing its two-year fixed-rate mortgage product, after it received a high volume of interest.
Head of mortgage products at the bank, Richard Taylor said they had seen rising demands for 4.99 per cent two-year fixed-rate product and that was why they took the decision to remove it from the range.
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