As readers of previous blogs will know, one of my main concerns is the lack of support for first time buyers in the property market. This is primarily due to lenders tightening up their lending criteria and refusing to break the 90% loan to value rule. I was pleased to hear from contacts in the USA that the housing market there is starting to show signs of recovery and the banks are now providing 95% and 97% mortgages.
I have been in discussions with a major High Street lender regarding a variety of mortgage products and I am delighted that due to those discussions we can now launch the Blackadders Deposit Match Scheme. In practice, this means that if we are able to reach a deal on a property for at least 5% lower than the Home Report valuation the lender will class this as a 5% deposit requiring the purchaser to fund a minimum of a further 5% and thus treating the deal as a 95% mortgage. This product is available for all purchasers although I do think it will be of particular interest to first time buyers. I think that this will start the release of the housing chain and will be a welcome development for purchasers and sellers.
This is a very exciting development and one that I believe will mark the beginning of an improvement in the housing market. As I have mentioned before, to get a self sustainable property market we need to get the number of first time buyers over 40%, i.e. the number of first time buyers in the market needs to be more than 2 out of 5 of all purchases. This scheme will assist those who have small deposits or those who require to retain funds to pay for home improvements or contribute towards the purchase outlays such as stamp duty.
This is another exciting initiative that we are delighted to be part of and shows our commitment to getting the housing market moving.
I will report on the success of the Scheme in further blogs but in the meantime should anybody require further information then please do not hesitate to contact either myself or another of the Blackadders Property Team on 01382 342222.
Head of Property Services