First-time buyers (FTBs) may be encouraged by the recent news that Santander is increasing the maximum loan-to-value (LTV) on its mortgages for new build-houses.
As a result of the move, buyers will be able to get their hands on a 90 per cent LTV product, which is virtually unheard of in the current marketplace.
Paula John, editor at Your Mortgage, emphasised that this is good news for those hoping to get on the property ladder for the first time.
"In general we are seeing more competition come into the mortgage market and more provision for first-time buyers in terms of higher loan-to-value products across the board," she commented.
Ms John stressed that many lenders had largely ignored FTBs in the past, mainly because this is seen as a high risk strategy.
"New-build has suffered because the value of particularly new-build developments in city centres has come down drastically in the last couple of years," Ms John explained.
In many cases, the properties had been over-valued, which meant that mortgage lenders simply did not want to provide the capital people needed to purchase them.
However, FTBs are keen on going for new-build homes, mainly because of the value for money they offer and how easy it is to secure the finance for them.
She continued: "I'm sure the developers are absolutely delighted that it is getting a bit easier for their target audience to actually have the wherewithal to buy their properties."
Building has been affected by the recession, so anything which is likely to help it back on to its feet is going to be good news, Ms John suggested.
Santander's move is one which will help FTBs and developers alike, she highlighted, which may be something other lenders look to follow. |
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