New breed of Belfast house buyers let down by outdated mortgage market
ONE in ten people in Belfast have been unable to secure a mortgage due to the fact they are not in full-time contractual employment.
A new survey from Online Mortgage Advisor has revealed that the likes of entrepreneurs, freelancers and those on zero hours contracts are struggling to get on the property ladder.
Almost half (45 per cent) of those surveyed in Belfast said they have delayed home purchases due to their working circumstances, while 10 per cent have actually been excluded from applying for mortgages.
Of those surveyed over half (55 per cent) said the current mortgage lending criteria did not reflect modern society, while over a third said they have
hidden elements of their financial circumstances from their partner or family due to concerns about the potential impact on a mortgage application.
Across the UK almost one in ten (9 per cent) 'new normal' (those not in full-time contractual employment) owners said they couldn't find a mortgage, with the proportion rising significantly for freelance workers (16 per cent), those on maternity or paternity leave (20 per cent) and for people on zero hours contracts (28 per cent)
Overall, 38 per cent of new normal homeowners have considered delaying their home purchase until their circumstances change. The average delay is 2.1 years, although 13 per cent have considered waiting for over five years.
It is a potentially lucrative market, with the average new normal home owner planning to spend or has spent £174,377 on their first home.
Pete Mugleston, managing director of Online Mortgage Advisor said the current mortgage lending criteria is not inclusive.
“New normal homeowners don't fit the mould of traditional mortgage lenders,” he said
“For example, freelancers often earn the same, or more, than full-time employees, but their income can vary from month to month – and mortgage lenders often want two or three years of accounts.
“Circumstances that were unusual for first time buyers 30 years ago are now much more common. But many lenders haven't kept pace with the rise of new normal homeowners, offering harsher lending criteria or just turning them down – with very real, personal consequences.”