Many mortgage lenders are adopting a cautious approach to lending and have reduced the loan to value amounts they offer amid the ongoing credit situation.
While the threat of falling house prices has led many lenders to take precautionary measures, it is not all "doom and gloom" for first-time buyers, according to Moneyfacts.
Commenting on the issue, Darren Cook, head of mortgages at Moneyfacts, said: "It looks like [lenders] are starting get slightly jittery at the prospect of house price falls - which is not too good for first-time buyers, who have to raise the capital [to cover] that five per cent in order to purchase property."
He added that he thought lenders would continue to support first-time buyers, but are just exercising caution with how they "advance their funds".
However, Mr Cook also noted that such measures are also in the interest of both parties, given that it is good ethics for a lender to not "over-commit" to first-time buyers.
In related news, Chelsea Building Society recently recorded a drop in first-time buyer mortgages last year, reports MyFinances.
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