Property market 'affected by high LTVs'

Posted: 10 Aug 2011 12:00:28 GMT

High LTVs and large deposits are serving to stifle the property market in the UK, it has been claimed.

The property market in the UK is being adversely affected by the high loan-to-value (LTV) on mortgaged homes, it has been suggested.

Paul Hearnden, a director at MyMortgageDirect, noted the large deposits required in order to purchase a home are also serving to stifle the sector.

The industry figure observed: "The only way that we're seeing first time buyers being able to get that much deposit together is [where] their parents are remortgaging their properties to release equity."

A person's mother or father may also need to offer their children savings in order for them to obtain a deposit big enough to get a foot on the property ladder, he added.

Mr Hearnden's comments came after new research from the Council of Mortgage Landers revealed the aggregate LTV ration on mortgaged property in the UK is currently less than 60 per cent, despite the amount of unmortgaged housing wealth possessed by individual borrowers varying significantly.
 

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