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Growing disconnect between perception and reality for UK first time buyers, report suggests
The number of people buying their own home in the UK for the first time increased in 2014 but there is a growing disconnect between reality and perception of the market, new research suggests. According to the latest generation report from the Halifax improving economic conditions together with high profile government schemes such as Help to Buy, saw the highest amount of first time buyers purchase their first home for seven years. From a peak in 2006 of 402,800 first time buyers, numbers fell as low as 192,300 in 2008 before climbing back to 311,500 in 2014. Despite this the annual generation report found relatively little improvement in how potential first time buyers view their chances of getting on the housing ladder. The research also shows that 79% of 20 to 45 year olds believe banks don't want to lend to first time buyers, and 21% believe it is virtually impossible for first time buyers to obtain a mortgage. The Halifax says that there is clearly some work to do to dispel the myth that banks are averse to lending to first time buyers. And the proportion of people saving for a deposit has dropped 6% with some 43% currently saving to buy a property compared to 57% who are not. The lender says that this strengthens the view that more people may be giving up on owning their own home and are instead accepting renting as a viable way of living in a nice home, in an area they want to live in and in the right size of property. The Halifax also highlights the emergence of a new demographic split between those who want to get on the housing ladder and those who say they don’t at 13% in 2011 compared to 16% in 2015. The presumption that the UK is obsessed with home ownership may need revaluating and a lower level of home ownership may become the new normal, it adds. The research also shows that 53% think the Help to Buy scheme has had a positive impact, but 39% don’t know or are undecided and the three most cited barriers to home ownership among those who do not own a property are the size of the deposit for 57%, high property prices for 56% and low income for 53%. London has the lowest proportion of home owners aged 20 to 45 or 39% and the highest number of people in this age range who worry they will never own a home at 82% while non home owners are currently prepared to save for average of 5.35 years in order to save for a deposit whereas homeowners saved for an average of 3.6 years. The average amount that non home owners can afford to save each week is now £33.35 and 39% of 20 of 45 year olds are saving to buy two bed properties, split between flats and houses at 18% and 22% respectively. ‘This year’s report has… Continue reading
Damp is number one turn off for UK house hunters
Damp, poor maintenance and a lack of parking top the list of UK house hunters’ biggest turn-offs, according to new research which is published as the spring house season begins. Damp patches staining walls and ceilings are the biggest problem for potential home buyers according to a new survey commissioned by Gocompare home insurance. It found that 67% of people would be deterred from buying a property which showed signs of damp. Others include poor maintenance, wooden windows, no garden, stone cladding and nasty odours. Some 60% would be put off by windows being rotten or in a poor state of repair, 55% by no parking, 54% by no garden, and 53% by smells caused by pets, damp, food and cigarettes. Some 53% would also be put off by unfinished building work. Poor natural light and dark rooms would be a turn off for 46% while 45% would be put off by small rooms. Some 42% would not like poorly finished DIY, 40% a small kitchen and 36% a dirty house. ‘If you’re looking to sell your home it’s important to make sure it’s well presented, both inside and out, to make it as appealing as possible to would be buyers. Buying a home is a big financial commitment and most house hunters will want to think that the property they’re buying has been well looked after by its current owners,’ said Ben Wilson of Gocompare home insurance. ‘Damp can be expensive to repair and may be an indication of a costly problem with a property such as a leaking roof. Unfinished or badly carried out work can be expensive to remedy and can detract from the value of a property as well as deterring potential buyers,’ he pointed out. ‘Bad housekeeping can also kill a sale. During a viewing many buyers will try to imagine themselves living in the property, so a dirty home, nasty smells and cluttered rooms can be a big put-off. They can also be a sign of other problems with the property. Clutter could suggest a lack of storage space, while a dirty home may suggest to buyers that the house has been unloved and in a poor state of repair,’ he explained. ‘So, a good spring clean is one of the easiest and most cost effective ways to create bright, fresh airy rooms and increase the saleability of your home,’ he concluded. Continue reading
Over half of UK first time buyers rent before they buy
More than half of the UK’s first time buyers now try before they buy when it comes to owning their first home, according to an annual survey. The research from Clydesdale and Yorkshire Banks found that 54% of the nation’s first time buyers rent before they take the house buying plunge. A further 35% stay with family and 6% rent but move back to the family home to save for a deposit. The same survey last year revealed that 67% of first time buyers in the UK were waiting longer than planned to buy their first home with more than half of those surveyed revealing it had taken up to three years longer than anticipated. There is a clear financial benefit with 39% of those at home claiming to live rent free. Some 61% pay rent every month and a further 21% make a contribution through helping at home, paying bills or buying food for the household. However, 80% of Scots living at home pay rent compared to just 46% of those in London. The majority, 56%, of first time buyers said they feel pressure to buy their own home and this is felt most keenly amongst those renting a property. There were regional variances with 65% of first time buyers in London admitting to pressure to take their first step onto the property ladder. This compared to just 37% in the North East. ‘We know that first time buyers face a number of pressures and challenges and are focused on providing support throughout the process from helping to save for a deposit to finding the right mortgage to suit different needs and budgets,’ said Steve Fletcher, head of Clydesdale and Yorkshire Banks retail network. He pointed out that Clydesdale and Yorkshire Banks are offering first time buyer mortgages with a 5% deposit. ‘We are proud that we were one of only a handful of lenders who continued to support this market throughout the economic downturn,’ he said. First time buyers with a deposit from as little as 5% can apply for a first time buyer mortgage and receive the benefit of no arrangement fee, £250 cashback and one free home valuation. The Banks offer a three year fixed rate of 3.59% with 90% LTV or 4.89% for a three year fixed with a LTV of 95%. Continue reading
