Mortgage Stress-Test Changes: Buyer Boom?
- Sarah Ruivivar
- Jun 10
- 1 min read
Changes in the way lenders stress test borrowers might just open the floodgates for first-time buyers.
According to Savills, these changes could boost first-time buyer transactions by up to 24% over the next five years. Talk about a game-changer!
So, what’s the scoop? The Bank of England's recent guidance means lenders no longer need to stress test borrowers at the Standard Variable Rate plus 1% for fixed terms under five years. This has led several big lenders to tweak their affordability tests, albeit in their own quirky ways.
Savills crunched the numbers and found that these relaxed lending rules could lead to an increase of 47,000 to 80,000 first-time buyer transactions, depending on house price growth. This could push house prices up by an extra 5.0% to 7.5% over existing forecasts. Cha-ching!
Want to hear more? Join Mal & Matt on the Property AI Report Podcast each week!
Access from your preferred podcast provider by clicking here
Lucian Cook from Savills notes that while the impact won't be immediate, the medium to long term could see a surge in buyers. This is great news for housing delivery, but it might not be enough to hit government housebuilding targets.
In a nutshell, these changes could mean more first-time buyers, higher house prices, and a bustling property market. So, keep your eyes peeled and your calculators handy, because the next five years could be a wild ride!
Want to hear more? Join Mal & Matt on the Property AI Report Podcast each week!
Access from your preferred podcast provider by clicking here
Made with TRUST_AI - see the Charter: https://www.modelprop.co.uk/trust-ai
Commentaires