FTB black hole climbs to 3.5 million homes since the financial crisis: IMLA – Mortgage Strategy
The latest data from the Association of Agency Mortgage Lenders shows that about 3.5 million potential first-time home buyers have exited the housing market since the 2008 financial crisis.
“Since the financial crisis is still waiting to enter the market, they may expect people who buy a home – unnecessary barriers, rather than the ability to meet mortgage payments,” the broker said.
It said “overly strict regulations are the main contributor”, blaming the loan-to-income flow restrictions on key limitations in its research.
Currently, the Bank of England’s Financial Policy Committee (the Financial Conduct Authority is a member), the rules say that new residential mortgages are limited to or greater than 4.5 times the salary of total home loans per year shall not exceed 15%.
Nationwide, Skipton Building Society and UK Finance are one of many lenders and institutions, who also requested that this limit be raised to around 20%.
But Bank of England Governor Andrew Bailey and Financial Conduct Authority CEO Nikhil Rathi warned that easing the restrictions could raise property and raise house prices.
Imla said the number of FTBs that failed to enter the market has increased by 800,000 since the 2021 report.
Its earlier report found that “thought years of ultra-low interest rates, the number of first-time buyers has not recovered since the financial crisis.
It concluded that “2.7 million potential buyers are expected to buy their first home based on the tendency to buy versus actual purchase numbers.”
Its new study says: “Although mortgage rates are higher,[former Prime Minister Liz]Last year, trusses, 330,000 FTB on the ladder.
“This figure is 15% higher than the long-term average for the past 17 years and clearly shows that demand has been curbed.”
IMLA Executive Director Kate Davies (pictured) added: “Obviously, more action is needed to help first-time buyers. In particular, the loan-to-income flow limits limit how much mortgage lenders can offer at higher loan-to-income levels, which prevents many wise borrowers from buying their first homes.
“Welcome the government’s commitment to reduce the financial services of the Traditional Tape Festival, we await the results of the review of the collateral rules of the financial conduct authority.
“Many lenders are expanding revenue multiples and higher loan product innovations with longer mortgage terms.
“Now, we need governments and regulators to follow the necessary rule changes to really move the dial.”
