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We need more 90% choices

I will start my column by apologising for the drop in quality from my regular articles. My professional ghost writer, Melanie Bien, is awaiting the arrival of her first child and the tried and tested method of my ideas and her words is on hold for three months. For now, you will have to make do with my ideas and my words.

Over the last few weeks, I have noticed an increase in appetite from the main five lenders for higher loan to value business.

Previously, the supply chain focused on ultra-safe sub-60 per cent business, the ultra-safe benchmark has now moved to between 70 per cent and 75 per cent, with new product ranges from Woolwich and Abbey reflecting this.

This suggests that credit and risk departments are more com- fortable with the outlook for the housing market despite the material differences between the house price indices from Nationwide and Halifax.

However, 75 per cent mortgages remain out of reach for a large number of homeovers and first-time buyers. I have no desire to see the return of 100 per cent-plus mortgages but we clearly need more choice in the 90 per cent area.

Purchasing a property with a 10 per cent deposit requires a significant borrower commitment and should be viewed positively. Abbey stands out as the only main lender providing a solution, albeit a five-year fixed rate at 7.09 per cent. The recent increase in demand for mortgages is at risk of stalling unless more lenders enter this market.

I will sign off with a comment on dual-pricing, which appears to be raising its ugly head once again.

The lenders I talk to blame each other, citing the need to maintain a competitive branch offering. Despite this, one or two have continued to operate fairly and with clarity, in particular, Nationwide, which has maintained a consistent approach throughout.

Even in the turmoil of the current market, the intermediary sector will deliver well over 50 per cent of the market and, as better times return, I hope we all have long enough memories to remember those that showed their full support.

Mark Harris is managing director of Savills Private Finance

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