If you have tried to get onto the housing ladder in the last few years, you will know how tough it is. The average age of a first time buyer in the UK is now 37 and after recent figures showed that mortgage lending hit an eleven year low in December 2010, the Government’s patience has finally snapped.
Lenders are to be summoned before MPs next month to explain why lending to first time buyers is at such a low level.
Net lending in UK hits eleven year low
Last week, the British Bankers Association (BBA) reported that net mortgage lending in December 2010 was just £880 million – the lowest level since June 1999. The Daily Telegraph reports that Grant Shapps, the Housing Minister, ‘will demand answers to why the average age of a first-time buyer is now 37.’
The figure, which relates to buyers who do not receive help in getting onto the property ladder, emerged in a previous study from the Council of Mortgage Lenders which highlighted their plight.
Mr Shapps believes lenders are refusing first time buyers that represent a good risk and will tell banks that they need to come up with products specifically devised for people trying to get onto the property ladder.
New first time buyer deals needed
Last week, Mr Shapps said: “We have to avoid pulling up the housing ladder and cutting off a whole generation of young people who want to buy their own home.
“We want to do more to help aspiring first-time buyers – the average age of the first-time buyer with no support from their family is now 37, and there are 1.4m households who aspire to own a home but are simply unable to do so because of house prices and mortgage availability.
“So I’m calling together key figures from across industry to discuss how we can tackle this problem….there will need to be a unified effort and creative solutions from across the board to make sure we do not lock young people out of the housing market.”