Lack of mortgage finance 'restricting the market'

A lack of mortgage finance is placing severe restrictions on the market, one expert has claimed.

Chairman of online change of address service iammoving.com Simon Preston predicted that more people are likely to choose to rent in the near future.

He said that finance is "severely constrained", particularly for buyers seeking a mortgage at a high percentage of a property's value.

"Until that mortgage market comes back I don't think the owner-occupier market is going to resuscitate itself," Mr Preston added.

His comments come following a Council of Mortgage Lenders report that found the average cost of a deposit rose by two per cent to reach 20 per cent in June.

The average first-time buyer takes out a loan of more than three times their income, although Nationwide recently showed that the average house has fallen 8.1 per cent in the last year, making it easier for those with poor credit to afford a home.

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