Falling house prices and increasing rates were discussed once again in this weekend’s financial press, with the Telegraph reporting that home loans are set to become more expensive following a recent agreement by regulators that will require banks to hold more capital in reserve. Experts suggested that this will inevitably have a knock on effect on borrowers and urged anyone considering a new mortgage not to hold off for too long. The Lloyds Banking Group came under fire this weekend, with coverage in the Financial Times and the Times on the new restrictions on buy-to-let lending. The group has announced that it is cutting the number of BTL properties a borrower can hold from 9 to 3, as well as reducing total borrowing from £3 million to £2 million, amid concerns it is over-exposed to the rental market. Experts called the change a ‘significant move’ that will severely restrict the choice for those with larger portfolios. For residential lending, the Sunday Times revealed that the Lloyds Group has added £5,000 to the cost of home loans during the last 2 years, with the average margin on their 5 yr fixed rates increasing from 1.09% to 3.76%. Elsewhere, the FT reported that lower prices and higher-quality developments are drawing homebuyers back to the new build market, while the Sunday Times provided tips for parents of children going to Uni on keeping down costs, including student lets and guarantor mortgages.
What the papers say- 18th and 19th September 2010