First-time buyers are now in an excellent position with regard to the number of mortgages available that are aimed at this portion of the market.
According to the latest figures, there are now twice as many mortgage opportunities on the market for first-time buyers as compared to the situation three years ago. What’s more, the rates are better too – with a fall of 1% being seen in interest rates on these products.
The comparison site MoneySupermarket has revealed that in 2012 first-time buyers had 1,324 products to consider. Now they have far more, with a total of 2,776 mortgage products available. This is good news for those who are looking to buy their first property, especially when the lower interest rates are taken into consideration as well.
A much better choice for 95% mortgages as well
According to the same statistics, there is now a greater number of 95% mortgages on the market too, for which a 5% deposit is required. The increase seen since 2012 has been an impressive 448%.
It certainly provides all first-time buyers with far more choices than they had three years ago. However it is still the case that larger deposit values will secure better deals from the marketplace than the standard 5% deposit. Buyers should consider how much they are able to put down.
Consider the whole cost, not just a great deal
However MoneySupermarket also warned buyers should be aware of the figures behind a particular deal. Many products are released to great fanfare, offering a headline-grabbing interest rate. We have seen this several times in recent weeks with a series of 1% and even below-1% deals offered to keen buyers.
However the fees associated with each mortgage product should also be borne in mind. When considered along with the interest rate the prospective homeowner might find a lower interest rate is not actually as good a deal as they thought it was.
Better choice means more possibilities for those looking to get on the housing ladder
However on a more positive note, the expansion of the mortgage market for first-time buyers does mean they have far more choice than they had several years ago. Buying your first property is always a challenge, and although house prices are rising, making the amount required for a deposit larger, this is being balanced out to some extent by the choice of mortgages available.
All in all this could turn out to be a promising time for many first-time buyers to get on that ladder if they have the required deposit and are accepted for a mortgage. If house prices do start to rise further, it could put properties out of reach of some of those keen to buy one. With interest rates staying low for the foreseeable future there is also a chance to lock into a decent interest rate that won’t break the bank at this crucial stage of getting on the ladder.