first-time buyers
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How long does it take first time buyers to save up?
Shocking figures just out reveal that it takes five and a half years for the average couple to save up for a deposit while it takes singleton savers ten years. The data from the London market is even more hair-rising. There, couples are taking on average nine years to save up a deposit while single savers require 14 years, says Hamptons International. This is despite recent help for from the Bank of England, which announced a cut in interest rates in early August. This has been passed on by lenders in recent weeks including to first time buyers (FTBs) and, if they shop around, rates for ‘discounted mortgage’ products can be found for under 3% while several two-year fixed rates are available at 3.5%. Overall, August’s 0.25% cut to interest rates, if fully passed on, mean that mortgage payments could on average be £244 a year lower for the average first-time buyer home in England and Wales. In London, the agent says, mortgage payments would be £518 lower. But despite the long wait to gather a deposit, enthusiasm for property ownership is not waning; figures from the National Association of Estate Agents show that the number of sales to FTBs has…
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Latest property news
The Brexit effect
It’s that ‘turmoil’ word again, as the UK flounders in a mire of political pronouncements and predictions.
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Features
The EU Referendum
NAEA and ARLA say that an ‘Out’ vote risks major construction skills deficit, jeopardising plans to expand British housing stock, but a Brexit could help first-time-buyers onto the property ladder…
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Housing Market
Home buying barriers frustrate 1.7m tenants
One in three private tenants has put their plans to buy on hold and remained in rented accommodation longer than planned, according to Experian research. Home ownership has been considered an integral part of ‘The British Dream’ for generations, yet Experian’s survey of nearly 1,500 private tenants in the UK suggests 1,655,680 tenants are frustrated first-time buyers. 18 per cent private tenants don’t believe they would be accepted for a mortgage so feel renting is their only option, while 10 per cent have struggled to raise a deposit, delaying their plans to buy. A further five per cent have had to prolong their time renting as they’ve been held up in securing a mortgage. Despite making regular payments for their housing, private tenants don’t see this reflected on their credit report in the same way mortgage payers do. To help them get a mortgage, access finance or prove their identity online, Experian has developed the Rental Exchange. Experian’s Jonathan Westley (left) said, “Many would-be first-time buyers face the challenge of saving for a deposit on a home while paying rent each month. While our research also shows that a significant amount of people are happy to rent in the long-term,…
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Housing Market
New homes: Government is “pulling out all the stops”
On the first day back at work after the festive break, Prime Minister David Cameron announced another new scheme to get Britain building. Smaller developers will be able to buy sites in England with planning permission in place – with 40 per cent of the new-builds to be “starter homes” aimed at first-time buyers. Direct commissioning has not been used on this scale since Margaret Thatcher started the regeneration of Docklands, the benefit is that it allows the government to assume responsibility for developing land, instead of large building firms. Prime Minister David Cameron said it was a “huge shift in government policy. Nothing like this has been done on this scale in three decades, government rolling its sleeves up and getting homes built.” The Labour party said he was using “rhetoric to hide his failure on new homes.” Shadow Housing Minister John Healey said the announcement did not promise new investment or affordable homes beyond those already announced. ‘Radical’ shift Adding to Mr Cameron’s energy rush, Communities Secretary Greg Clark (left) said that the government was not only rolling up its sleeves but was “pulling out all the stops to get the country building.” “We know that consistently 90%…
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Uncategorised
The market’s hot…warm…cold
Report Headlines Rightmove: “First-time buyer prices surge nearly 10 per cent in a year.” NAEA: “Sales to first time buyers rise.” Nationwide: “Slight pick-up in house price growth in October.” Halifax: “Annual house price growth rises to 9.7 per cent.” Agency Express: “October’s property market bucks seasonal trends.” LSL: “Fastest annual rise in house prices for six months.” Hometrack: “City level house price growth tentative slowdown.” Land Registry: “September data shows a monthly price increase of 1.0 per cent and the annual price change now stands at 5.3 per cent.” KATE SAYS: “The market clearly had a bit of an unexpected ‘up-tick’ this month, as until now, price growth seemed to have been slowing ‘on average’ each month. An odd statement though from Rightmove suggests that buy to let investors are “competing” with first time buyers. This shouldn’t really be happening as smart investors should secure a property at a discount, with cash, for example and find a way to add value. First time buyers on the other hand have the advantage over investors of needing a much lower deposit, essentially ‘gearing’ their purchase with a five per cent deposit or accessing schemes such as new build Help to Buy.…
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Housing Market
House prices set to rise
Residential property prices look set to increase by an average of £60,000 over the next five years, hitting more than £320,000 in 2020, according to Cebr, the Centre for Economics and Business Research. The economic forecaster expects the average price of a home in the UK to reach £263,000 this year, up 5.6 per cent on last year, but believes that the market offers further room for growth of 3.5 per cent in 2016, with further annual price rises of in the region of 4 per cent in the four years that follow. If accurate, these price hikes will take the average price of a UK home to £321,600 during 2020 – £58,600 more than the average residential property price in 2015, according to Cebr. Nina Skero, CebrEconomist and main author of the report, believes that capital growth will be primarily fuelled by a growing “reduction in the number of properties being put on the market” as a result of low levels of housebuilding, as well as other factors such as an ageing population and the rising cost of moving up the property ladder. He commented, “The price gap between a first-time home and a larger family home has skyrocketed…
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Housing Market
First-time buyer home prices soar
Home prices for first-time buyers are continuing to rise because of high demand from buy-to-let investors for properties typically acquired by those purchasing their first home, says Rightmove. New data supplied from the property portal reveals that the average asking price for residential properties currently coming on to the market has increased by 5.6 per cent over the past year to a new high of £296,549, but sellers of typical first-time-buyer homes are now asking 9.6 per cent more than this time last year. The average asking price of houses and flats with up to two bedrooms has increased by over £8,000 to £184,676, Rightmove said, making it harder for first-time buyers to save up enough money for a deposit. The report states that home prices are being driven higher by growing demand from buyers, particularly buy-to-let investors, and that a lack of properties coming onto the market was creating greater competition for purchasers, particularly first-time buyers. Rightmove added that the volume of first-time homes coming up for sale had dropped by 8 per cent on October 2014. The buy-to-let market has gone from strength to strength in recent years, reflecting the fact that a growing number of people are…
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Housing Market
More starter homes needed
The Government wants to give thousands of young people the opportunity to own property, David Cameron announced during the closing speech of the Conservative Party conference last week. Not for the first time, the Prime Minister talked about plans for new starter homes – to be built as part of a new residential development, allowing housebuilders to fulfil their obligation to develop affordable homes. Cameron hopes that the starter homes, which would be sold for 20 per cent below the market rate, will lead to a significant increase in housebuilding levels, as part of the Government’s plans to tackle the mounting housing shortage. The starter homes discount will apply to properties worth up to £450,000 in London and £250,000 outside the capital, and the Tories believe this scheme will provide 200,000 new homes by 2020. The Home Builders Federation (HBF) has welcomed the Government’s plans to deliver on its pledge to improve homeownership opportunities for young people. Stewart Baseley (left) of HBF said, “Greater flexibility in the way affordable housing is provided should not only speed up the process of securing an implementable planning permission but also make more sites viable for new housing. This will in turn increase availability…
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Housing Market
Housing market is at ‘crisis point’
The supply of residential properties for sale has slumped to its lowest level for 11 years, stoking fears that the growing housing shortage will continue to dive up home prices. Fresh data released by the National Association of Estate Agents (NAEA) reveals that the volume of properties available to buy per estate agent branch fell to 38 in August, down 31 per cent on July’s 55. This is the lowest level of supply recorded since January 2004, when 38 properties were also available. August also saw a dip in the number of house-hunters registering with agents, with an average of 408 applicants registered per member branch, compared to 462 in July, owed in part to the fact that many people were away on their summer holidays. Mark Hayward (left), Managing Director of the NAEA, said, “We’ve been banging the drum about the dwindling supply of housing for a while and this month’s report reiterates what we’ve been saying – there simply aren’t enough houses to match demand and we’re reaching crisis point. “There are now eleven house hunters fighting after every available house which isn’t sustainable.” The data also shows that the number of sales completed in August rose by…
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