Lending criteria key to unlocking mortgage market, say brokers
Lenders need to introduce more accommodating lending criteria in order to stimulate transactions in the UK housing market, according to a survey of Avelo’s Exchange Portal users.
The technology company found that nearly half (47%) of respondents opted for lending criteria as being the critical factor, with a quarter (23%) suggesting higher LTV products would help the market.
Just 14% thought policy initiatives such as stamp duty holidays would be key, ahead of increased housing supply and product innovation - 9% and 7% respectively.
Exchange users took a medium term view on the time horizon for market recovery. Two in three (68%) thought the market would take a further three years to reach the house sales volume high of May 2007, with just one in 15 (7%) expecting the recovery to happen within two years.
Henry Woodcock, principal mortgage consultant at Avelo, said: “The mortgage market has faced one of its toughest ever periods in recent years, with brokers looking at how they can responsibly help their clients to get on or move up the ladder.
“However, there are clear areas which they feel could help stimulate the market, with more accommodating lending criteria the most popular.
“It is not surprising that policy measures received such little support as the stamp duty holiday did not produce the desired market stimulus, and schemes such as FirstBuy and NewBuy struggle to have an impact.
”The message from brokers is clear: lenders need to do something to help the market start moving again.”