The recovery of the market lies in the hands of lenders

"Lenders are using the credit crunch as an excuse to stockpile funds, including those banks who benefitted from the recent bank bail outs, which is clearly not in the consumer's interest. Ironically, Northern Rock is currently offering some of the most expensive rates on the market with a higher loan to value, while they rake in deposits from savers looking for a safe house for their cash. The Chancellor may have met with a group of leading banks today to urge them to pass on yesterday's rate cut, but they have not listened in the past and the Government needs to do more.

"The fact is that the three-month Libor rate is a now lower than it was a year ago, yet in October last year a borrower taking out a 90% LTV mortgage would have paid typically 5.99% for a two-year fixed rate deal, but the same deal today would cost them in the region of 8.14%. There is no excuse for this profiteering. The recovery of the property market, which is surely in everyone's interest, lies in the hands of lenders.

"There are very few lenders offering 90% LTV deals currently. But first time buyers are essential if the market is going to recover, and high deposit requirements mean home ownership is still out of reach for the vast majority. Shared equity schemes offer an excellent solution, but there are only a handful of lenders operating in this area of the market. This too needs to be addressed if we are to see first time buyers returning in any significant numbers."

Join the debate:

Please email your views to andrew@thepublishinggroup.co.uk on what needs to be done to get FTBs buying again, or do you think they are waiting for prices to fall.