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First-time buyers face tough task as mortgage product availability dwindles, but buy-to-let investors spoilt for choice

The latest research by specialist property lending experts, Octane Capital, has shown that first-time buyers face the toughest task when it comes to securing a mortgage in the current market, with the number of products available to them reducing by -3.4% in the last three months. However, landlords are currently spoilt for choice, having seen the number of buy-to-let mortgage products increase by 8.8% over the same period. 

Octane Capital analysed the number of mortgage products currently available across the market* and how the level of product availability has changed for each type of mortgage. 

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The research shows that first-time buyers face the toughest challenge securing a mortgage in the current market. Octane Capital found that there were just 595 mortgage products currently available (Jan 2024) to first-time buyers, accounting for just 7% of total mortgage products on the market. 

What’s more, this number has reduced by -3.4% in the last three months alone, the largest reduction of all mortgage product types. 

Home movers have also seen the number of mortgage products available to them fall over the last three months, down 1%, accounting for 35% of all mortgage products. While this is the second smallest proportion of total products available, they are benefitting from a significantly higher level of choice compared to first-time buyers, with some 3,000 mortgage products available to them. 

Those looking to remortgage are benefitting from the greatest level of choice at present, with this number having increased by 1% since October, accounting for 37% of total products. 

However, it’s landlords who have seen the biggest boost to mortgage product availability. In the last three months, the number of buy-to-let mortgage products has climbed by 8.8% to a current total of 1,889.

CEO of Octane Capital, Jonathan Samuels, commented:

“Generally speaking, there has been a growing level of buyer confidence since the Bank of England held the base rate for a third consecutive time in December. 

That said, while the general expectation is that interest rates will fall this year, many lenders are continuing to tread with caution and this is why we’ve seen a reduction in the number of mortgage products available to both first-time buyers and home movers.

This is because those looking to buy for the first time, or borrow more to move further up the ladder, are often more susceptible to the potential affordability issues caused by higher mortgage rates.

However, this reduction in product availability hasn’t been seen across the entire sector and buy-to-let investors, in particular, are currently benefiting from an increased level of choice when borrowing.”

Data tables and sources

Current and historic mortgage product availability sourced from Compare the Market, Money Saving Expert and Moneyfacts.

Data tables and sources can be viewed online, here.

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