first-time buyers
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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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Housing Market
First-time buyer activity hits pre-recession high
There was a sharp increase in the volume of first-time buyers in the UK in July, as the prospect of a rise in mortgage borrowing costs encouraged more young purchasers to acquire their first home. The latest First Time Buyer Tracker index from Your Move and Reeds Rains reveals that the number of first-time buyers reached their highest level in July since the recession, paying £161,985, on average, which is 8.9 per cent higher than in the corresponding month in 2014. Overall, there were 29,700 sales of residential properties to first-time purchasers in July, up 4.9 per cent month-on-month. This is in spite of the fact that the average first-time buyer now requires a deposit of £27,975, which is up 10 per cent compared with July 2014’s figure of £25,429. While rising deposit costs may have deterred some prospective purchasers in recent months, increasing real wages have enabled some first-time buyers “to shoulder the short term burden of a slightly higher deposit” to spare the risk of losing out on a good mortgage deal, according to Adrian Gill (left), Director of estate agents Your Move and Reeds Rains. He added, “This month’s particularly high transaction rate is also partially due…
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Housing Market
First-time buyers make up nearly half of all mortgages
First-time buyers in this country now account for almost half of all homes purchased with a mortgage, a rise of 38 per cent since 2011, owed in part to a surge in first-time buyer mortgage deals, new research shows. The study from the Halifax revealed that first-time buyers make up 47 per cent of all mortgage-aided acquisitions, while the deposit that they have to pay has increased by 6 per cent over the past 12 months to an average of £29,894, reflecting a general rise in property prices over the past year. The average first-time deposit is now 82 per cent or £13,494 higher than in 2007. Overall there were an estimated 139,500 first-time buyers in the first six months of this year, down 7 per cent year-on-year, but while this is the first annual decrease on this basis since the first half of 2011, it is still the highest total for the first six months of the year since 2007. Craig McKinlay (left), Halifax Mortgages Director, said, “There was a modest decline in the number of first time buyers in the first half of the year following the substantial increases recorded in 2013 and 2014. This fall has been…
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Latest property news
Stamp duty changes save homebuyers £701m
The Stamp Duty Land Tax reforms that were introduced in December last year have saved UK homeowners £701million in the six months since the changes came into force, according to myhomemove. The Government’s estimate that the changes to how stamp duty is levied has cut the tax for 98 per cent of people purchasing homes under £937,500, is supported by the research carried out by the conveyancing service provider, which found that since the reforms each house buyer below this level has saved an average of £1,400. “The stamp duty reforms have saved UK home buyers a significant amount of money since its introduction and provided an important boost to the property market, just as house transactions were starting to slow down in the run up to the General Election,” said Doug Crawford, CEO of myhomemove. He points out that the changes have had a particularly positive impact on those struggling the most to get onto the property ladder, including first-time-buyers, as they can now save more money towards a deposit for their purchase. Crawford (left) continued, “Under the old ‘slab’ system, there was a substantial increase in price at the stamp duty thresholds, which the reforms have reduced significantly,…
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Housing Market
Ed’s last stand: “a load of cobblers”
General Elections bring out the opinions of the electorate and property people have been more than forthcoming in these last days before the big election day on 7th May. Naomi Heaton (left), CEO of London Central Portfolio says that Ed Miliband’s “last stand” is “a load of cobblers”. Among her points are: “The latest Labour pledge is to abolish stamp duty for first-time buyers buying homes worth up to £300,000 for the next three years. They have said that it will benefit nine in 10 such buyers to the tune of £5,000. Rubbish. “Labour is clearly very bad at its sums, which is why, of course, we are so worried about them running the economy. “The average purchase price for a first time buyer outside London is £137,120, (Halifax). Following the Stamp Duty reforms introduced by the Conservative coalition last December, the Stamp Duty charge for buyers at this level is just £242. This is what the Labour policy would save, not £5,000. “If we look at the country as a whole, including London, the average price for a first time buyer, is £171,870. Again, due to the recent reforms, Labour would be knocking off £937 off their purchase costs,…
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Housing Market
Labour proposes housing bond to develop 125,000 new homes
Labour plans to introduce a housing bond system to generate up to £5 billion to fund the construction of up to 125,000 new homes if elected at next month’s General Election, the party has said. Using the Help To Buy ISA, which was announced for first-time buyers by the Chancellor, George Osborne,as part of his Budget last month, the new bond scheme would enable house builders to develop significantly more new homes Income from the ISA would be placed into a “future homes investment fund” for new residential property schemes and is similar to housing bonds used in the 1920s to stimulate housebuilding. The fund, designed to help tackle the chronic housing shortage in this country, will be targeted at new sites with first-time buyers offered priority. In a speech to Labour supporters in Warrington on Saturday, Ed Miliband (left), said, “There’s nothing more British than the dream of homeownership. Starting out in a place of your own. But for so many young people today that dream is fading.” Describing Labour’s plan as the “first real plan for housebuilding in a generation”, Mr Miliband has vowed to deliver at least 200,000 homes a year by the end of the parliament,…
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