Never mind the royals, FTBs need matchmaking

Gemma Harle is managing director of TenetLime

Kate Middleton and Prince William have much to be thankful for - not least the country’s best wishes - but one thing is for sure: they will not be undergoing the trauma of regular first-time buyers.

Whether they take residence in royal apartments or not, the prospect of scraping together a deposit only to be rejected for a 90% LTV loan because they have no repayment history is not theirs to worry about.

Of course, in the industry, lenders are making no secret of the fact that they would rather allocate their funding to lower risk buy-to-let loans, with higher deposits of 25-40%, than first-time buyer loans. This is arguably of no difference to brokers. Indeed buy-to-let is often more likely an advised sale than say a branch sold first-time buyer loan. But in the longer term this will not help develop a healthy mortgage market. All parts of the house buying eco system need to be functioning for it to thrive.

Policy makers and Government recognise this. For some in the Treasury, the answer is to decrease house prices until the affordability risk calculation becomes acceptable. The problem is that as an island and in particular in the South East, there is a finite amount of land to develop and too much demand for it. Successive fiscal initiatives have all failed to substantially help the first-time buyer market.

Lenders will have to alter their stance if the market is not to grind to a halt in the longer term because there is no chain from the bottom up. Divorcees and long-term singletons cannot sustain flat buying forever. We need affordable mortgages for first-time buyers. Now that would be a match made in heaven.