Finance Wanted.

By James C Kerr

The UK housing market currently faces an uncertain future. With the housing crisis in the US threatening to spread across the atlantic the outlook is uncertain for first time buyers in the UK. Currently the average first time buyers' property price is around ฃ160,000, a figure that forces many to forget about getting their foot on the bottom of the housing market ladder for a few years.

Despite recent Interest rate cuts, the global credit crunch and uncertain economic outlook are keeping the costs of mortgages high, causing a firm barrier to entry for first time buyers. Finding a competitive deal is proving tricky, especially as many 2nd or 3rd time buyers have the advantage of using equity released from recent house pice inflation from the last few years.

For those searching for a very high LTV mortgages the outlook is looking equally tough. Worries are that the UK may suffer its own subprime crisis should house prices fall significantly. As a result mortgage lenders are tightening their lending criteria and demanding much larger deposits than they were a year ago.

Another factor, aside from the sharp rise in property prices in recent years, is the increasing cost of university. Compared to10 years ago graduates are now leaving university with much more debt (and average of ฃ13,000 in 2006) meaning they are much older by the time they have saved up enough of a deposit to purchase a house.

All of the above factors are making it increasingly harder for first time buyers to affarod a mortgage.

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