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First Time Buyers are unable to get on ladder
It has been reported that there is a strong return to the market of buy to let investors and that this may cause a problem for first time buyers wishing to enter the housing market.
The mortgages have risen by more than a third over the months January to March this year and the Council of Mortgage Lenders (CML) has said that the amount of loans issued, more than 32,300, represents an increase on last year at the same period of 32 per cent. This is in contrast to the first time buyer mortgages dropping to their lowest level for nine months during April.
It is felt that the main problem is lack of support in funding first time buyers by the mortgage lenders. The amount of deposit required for those hoping to get on the property ladder makes it almost impossible to everyone except those with high paid jobs, impeccable credit records and a large cash sum. The lenders are said to be more willing to offer further funds to buy to let landlords who already have a proven track record and are able to manage larger deposits. The number of first time buyer loans has fallen to their lowest since July 2011 at 11,307.
There is often a shortage of rental properties and many more rental tenants coming on to the market as they leave their parent’s homes and find they are unable to fund their own households.
The Housing Minister Grant Shapps said: "We do not have to make a choice between first time buyers and buy to let. We need both. And while a third of all mortgages went to first time buyers last year, only 12 per cent went to buy-to-let landlords”.
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