The world’s banks may still be in the grip of the global credit crisis but, contrary to widespread public perception, there are still mortgage funds available for most house-buyers.That is the view of Mark Rimell, who heads the St Albans Office at property agents Strutt & Parker, and it is supported by Simon Tyler, managing director of leading mortgage brokers, Chase de Vere Mortgage Management. “Anyone reading the newspapers or watching the television news, could be forgiven for thinking that there was no mortgage money out there at all. But that’s simply not the case,” says Mr Rimell. “If you’re lucky enough to have built up substantial equity in your property – as most people who have owned a house or flat for longer than two years have – then there are still good mortgage products out there.”
Mr Tyler agrees: “Obviously the days of 110 per cent mortgages are over and there’s no doubt that first time buyers without access to a sizeable deposit do face serious problems in the current market. But for anyone who has a 25 per cent deposit, there is a good range of mortgage products available, although the best deals are reserved for those buyers who have deposits of 40 per cent plus. While that sounds a lot, for anyone who’s been in the property market for a few years, it’s not.”
Mr Rimell acknowledges the serious difficulties faced by first-time buyers and points out that another group facing problems in the current market are those who bought their property in the last couple of years and who face the prospect of their equity being wiped out by falling prices, should the need come to sell. “I fully accept that there are owners facing real problems but there are also people out there, who may have been in the same house for five years or so and perhaps have salaries not directly tied to the City, who are very well placed to take advantage of the current market.”
“The fact is there are good deals to be had out there – in a falling market the price gap between, say, a good traditional farmhouse and a truly wonderful Victorian rectory does get smaller and it is possible to get a lot more for your money.”
Mr Tyler agrees, pointing out that a full range of products – fixed rate, trackers and variable rate mortgages – are available from such well-known names as Abbey, Cheltenham & Gloucester, Barclays and HSBC and from some of the long established private banks that have become more active at the higher end of the mortgage market in recent months.
“Margins have increased somewhat in recent weeks, largely because of the problems at HBOS and the forced withdrawal of the Bradford & Bingley from the mortgage market. But while mortgages have got a little more expensive in the short term, the medium term prospects are more encouraging with many economists forecasting a fall in bank base rates of a full percentage point or more, over the next 18 months.