Mortgages London | Mortgages in London

With property prices on the increase across the UK, the asking price of London homes is once again becoming out of reach of the average first time buyer. A combination of strict approval criteria and high deposits means that many would be home owners can no longer afford to buy a property in capital. It has been calculated that over the last 12 months the prices have risen by 10%, leaving savers seeking free mortgage advice from London lenders.

The majority of mortgage products available to first time buyers have an LTV cap of 75%, which means borrowers raising a deposit of 25%, which for an average priced London property would be in the region of £25,000. Obviously if the trend in rising house prices goes on as demand continues to outstrip supply, this figure is going to become higher and less attainable. Although there are more high LTV products coming on to the market, even the return of 95% LTVs, the large majority of these are not available to a first time investor.

There is good news though for those who are happy to relocate. The rapidly rising prices are not as dramatic in Scotland, with a rise of just 2.2%, although the wise investor would think twice about relocating to Northern Ireland, where house prices dropped by nearly 9%. Borrowers are advised to consult with an independent broker or mainstream lender to get free mortgage advice in what might be harsh times ahead for first timers blighted by mortgage applications that favour those who already have a home loan.

This year only 35% of loans were for first time investors, which is the lowest figure since late 2007; and as it is these purchasers that dictate the success of the property market, there are bound to be dramatic changes afoot to help those with a small deposit purchase a home in London. Whether it is a return to high LTV loans, introduction of government schemes or the decision to relocate that makes the difference, getting the right free mortgage advice could save you thousands in the future.

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