Demand for specialist mortgage lending is at an all-time high, according to Together’s 2024 Residential Mortgage Market report, which predicts continued growth in the sector over the next five years.
Together’s research showed that the three main drivers of growth would be Shared Ownership, projected to rise from £2.3bn to £5.2bn, lending to retired customers increasing from £600m to £1.4bn, and the demand for self-build property mortgages growing from £57m to £116m.
Despite this, access to mortgages remains challenging for many non-standard applicants.
Over the past five years, 7% of these applicants faced rejection, and 9% identified a lack of advice as a major obstacle.
Ryan Etchells, chief commercial officer at Together, said: “Our research highlights the true challenges faced by home buyers in the residential property market today.
“We can clearly see that in response to the wider economy and people’s changing lives and financial needs, the proportion of ‘non-standard’ mortgage applicants will only continue to rise.
“At a time when mainstream lenders are not adapting their lending criteria fast enough – the case for specialist lenders has never been clearer.
Etchells added: “Borrowers are turning to lenders that are willing to take time to build a relationship with them, understand their situations and use common sense to make lending decisions.
“With the five-year specialist market forecast looking so strong, it’s high time the industry, backed by the new Government, reassess how to best support homeowners in realising their property ambitions.”
Rob Thomas, economist and principal researcher at the Intermediary Mortgage Lenders Association, said: “As working patterns and lifestyles have become more diverse, there is now a growing legion of people who need the support of the specialist market.
“Estimates suggest that since the global financial crisis 3.1 million households who would have been expected to enter homeownership based on previous trends have failed to do so.
“Many of these households will believe that their specific characteristics block them from any chance of owning their own home when specialist lending may be able to provide the solution they need.
“Given the substantial social and financial benefits that homeownership has demonstrated over many decades it’s obvious that there is a need to improve awareness of the specialist options that might assist them in achieving their ambitions of homeownership.”
