Less Than A Quarter Of FTB’s Able To Get A Loan
Getting on to the housing and home owner loan market can be a difficult achievement for many would be first time buyers in the UK at the moment. A lack of home owner loan funding and low loan to value levels from lenders is making it almost impossible for some to be a able to purchase a property.
But the situation within the home owner loan market could be even worse than originally thought for first time buyers, following the results of a new survey conducted by the bank HSBC.
HSBC interviewed a total of 1,350 non home owners who would like to take out a home owner loan and buy their first home. However, the results found that around 80 per cent of those interviewed said that they would not be able to afford a loan, or the necessary deposit for at least five years.
Once these figures have been scaled up to cover the entire country and those looking for their first home owner loan, HSBC claim that there could be hundreds of thousands of would be first time buyers in the UK, who will be denied owning their own home through lack of affordability of a loan.
The average price of a first time buyer property is £136,842, which works out at 6.6 times the average wage of £20, 654 for a typical first time buyer. With the majority of lenders only prepared to offer loans of up to four times income on affordability grounds, there is still a huge gap to be bridged for anyone wanting to buy a house.
Although the government has just launched a new scheme to help first time buyers get onto the housing market by providing top up loans, most experts believe that this is only a gesture from the government which is only likely to help around 10,000 first time buyers.
