It’s now post-lockdown, the economy is slowly restarting after a sudden pause due to the Coronavirus pandemic. However, Loan-to-Value buyers are down by 95% on pre-crisis levels despite the revival of the property market.
There is little sign of a return of mortgage lenders.
There are currently just 20 mortgages available for buyers with the smallest deposits of 5%. This represents the 95% drop since the start of the coronavirus outbreak. However, there have been talks of a rebound in mortgage lending for those with smaller deposits, such as First Time Buyers. Nationwide then re-introduced loans at 90% loan-to-value in July.
The data also suggests the situation for 90% loan-to-value mortgages has got slightly worse in recent weeks, while there were 70 products available at the start of July, by the end of last week just 67, but before the COVID-19, there were more than 800 products available.
The lack of finance suitable for First-Time Buyers is one of the main reasons why forecasters are sceptical that rebound in the property market since the lifting of the current Lockdown measures, and this will continue in the longer term.
Stephen Kerrigan of MortgagesRM – Fee Free Mortgage Advisor Sheffield said: “Until more lenders return to this space with products to support the clear borrower demand, it seems likely that we will continue to see an ebb and flow in availability. It remains the case that the vast majority of products for those with only a 5% deposit are specialist options which may require borrowers to either work within specified professions, reside in certain lending areas, or to have a guarantor.”