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Millenials should know buying their own home is no longer a pipe dream – Bamford

by: Pad Bamford, business development director at AmTrust Mortgage & Credit
  • 14/01/2019
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Millenials should know buying their own home is no longer a pipe dream – Bamford
Given some descriptions of them, it is perhaps no wonder that young adults feel somewhat frustrated, especially as they might have a very real angst that the generations that came before them are now attempting to sell them down the river.


In recent times, and in our sector, millennials have been defined as’ Generation Rent’ – a label that probably adds further insult to injury.

This is a constant reminder that the housing market we have today has definitely not been developed with them in mind – far from it.

The Resolution Foundation think tank outlined how we now have a housing situation where increasingly it is only young people who come from wealthier families that are able to purchase their own property.


Complicit industry

Indeed, as I’ve railed against a number of times, I feel that the lending industry is being somewhat complicit in this, even perhaps exacerbating the divide that exists.

This is being done with the growing supply and provision of first-time buyer products which explicitly require the borrower to have the support of the ‘Bank of Mum and Dad’.

And that is despite there clearly being opportunities to provide products that could be made available to far more borrowers, for example, high loan to value (LTV) options.

Further research from Trussle said millennials are six times more likely to buy a property with a friend than the generation before them – the so-called Generation X-ers.

For many first-time purchasers this is not because they truly wanted to buy with friends, but because they feel this is the only option available to them if they want to have any chance of getting even half-a-step up on the property ladder.

Indeed, when asked, millennials said they would have preferred to buy alone, but that option – without family support – is very difficult, almost impossible for some.


High LTV products climbing

There is however some good news to report – the number of high LTV mortgage products is on the rise, and the rates available are falling, our most recent LTV Tracker just revealed.

And while lenders could definitely increase their appetite to lend in this space, we continue to see availability climb month-on-month.

Would I like numbers and rates to more closely resemble those that are available for first-timers with a 25% deposit, and/or the support of families? Of course.

But we should also send the message to millennials that the market has changed over the past 12 months, that high LTV mortgages do exist, are growing in number and that their ability to purchase their first home might not actually be a pipe dream after all.

Given the way the market might head this year, the importance of bringing in new blood to the market and your business should be clear to see.

Getting in early and delivering a quality service to first-time buyers should help you sustain your business and hopefully provide you with a client for life.


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