Posted on 11.11.15 by Reema Mistry
House sales to first time property buyers is on the increase which is great news for aspiring purchasers. The month of September saw a substantial 9% increase in sales to first time buyers (FTBs) when compared to the previous month of August. This means that FTBs accounted for just short of 30% of all property sales across the country, according to the National Association of Estate Agents.
Although there is still a huge disparity between the amount of budding homeowners and the number of housing available with apparently nine house-hunters striving for each available property, this is still positive news for FTBs. It shows an increase in confidence in the area, which has been reflected in the number of competitive mortgage products on the market.
Increase in the ‘Aspiration Gap’
On the flip side of the coin, those who are currently renting are finding it increasingly difficult to make the leap over to homeownership. In the latest figures, an astonishing 93% of renters want to own their own home, but only a poultry 6% believe they will buy a property in the next 12 months, which presents a rather sorry story.
It appears those in rental properties are setting their sights on the long-term. Renting is not cheap anymore and prices vary across the country, yet saving up for that all important deposit is extremely problematic. Just over 50% aim to buy within the next five years, which is up from 36% from December 2014, demonstrating an increase in people’s wishes, yet time will tell whether this a reality.
The clear problem is the housing crisis with 57% of renters stating that the lack of affording housing is a crisis that the UK has to face up to and solve. Housing prices are on the increase across the whole of the UK, but unfortunately earnings and savings are not matching them; this is causing more people to stay in rented property until supply fits demand.
The government are trying a few initiatives to increase support for these aspiring homeowners, yet it is mum and dad who are all too often picking up the brunt. Almost half of FTBs have revealed that relatives have helped them with their initial deposits. This number is much higher than those who have used the Help to Buy mortgage guarantee scheme (6%) or the Help to Buy equity loan scheme (3%).
You can read more about the Bank of Mum and Dad helping FTBs here.
Help to Buy ISA
Can the government-backed Help to Buy ISA prove any more popular? This much anticipated Help to Buy scheme comes into force on the 1st December 2015 and involves the government topping up your monthly savings up to a maximum of £3,000. There was much talk about this pre and post-election with the Tory government offering it as one of their flagship pledges.
The scheme is slightly more complicated than it is straightforward, so look out for our blog nearer the time which will explain just how you can take advantage of this scheme as a FTB.
Here at Gorvins we have a specialist conveyancing team who can provide the expert service you need. We work for all manner of people wishing to purchase or sell a house, from first time buyers to experienced property movers, to buy to let landlords investing in a new property. Our offices are based in Manchester, North West, but we work for clients all over England and Wales. Get in touch today to receive a no-obligation fixed-fee quote by ringing us on 0161 930 5151 or filling in our online contact form and we will contact you when it is most convenient.