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15 Jul 2019
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2 Aug 2019Increase in First-Time Buyers (FTB’s)
The number of first-time buyers in the UK was up 42% in February from the same time in 2014. This is largely due to the increased mortgage availability in recent times. There were 22,400 first-time buyer transactions in February which is significantly more than the 15,800 transactions in February 2018 and the 21,800 in January 2014.
It was also found that 96% of tenants who were registered with Your Move and Reed Rains wanted to become homeowners which was an increase from the 92% at the end of 2013. First-time buyers are eager to get onto the property ladder as soon as possible, especially seeing as 4 in 5 of them expect house prices to rise over the next 12 months.
The government’s Help to Buy scheme is proving popular due to the rising house prices so getting onto the property ladder quickly is helping with affordability. This rush for a property is driving up demand in the short run and consequently driving up house prices further.
The question that now arises is ‘How long will it take for supply to catch up with demand for houses for first-time buyers?’
It is now just 10% of tenants who now believe that they will never be able to afford to purchase a property which is down from 20% in December 2012. However, generating a deposit for a property still remains the largest obstacle to purchasing a property with 56% of tenants saying that it was the sole factor preventing them from purchasing. Another concern among tenants was having sufficient income to make and keep up their mortgage payments, with 18% of people voicing this concern. Half of these tenants do now believe that they will be able to purchase a property within the next 5 years.
Houses are more popular than flats with first-time buyers with two-thirds opting for the house with an average age of 31 years old and an average salary of £36,330. However, in London, two-bed flats are the most sought after properties with an average purchase price for first-time buyers of £280,477 in the capital.
