Mortgages limited for luxury properties

As the credit crunch takes its toll on the housing market, lenders are limiting the availability of high-end mortgage products.

Independent property advisor Bestinvest has said that the number of million pound plus mortgages on offer has reduced and the criterion for them has tightened.

Peter O'Donovan, head of mortgages at Bestinvest explained the dearth of high end loans: "I think it is partly due to the fact that lenders feel they have a smaller amount of money available to lend to at the present time. Therefore, they'd rather spread the risk over, say, 20 mortgages of 100,000 than two mortgages of a million pounds."

Mr O'Donovan has suggested that in the current climate there may not be as many million pound plus properties on the market.

Recent research from the Halifax Estate Agents has shown that sales of million pound properties in Great Britain rose by 36 per sent in 2007, but only accounted for 0.6 per cent of all sales that year.

Mortgages News posted on 11/06/2008 12:33:34