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Poll suggests UK first time buyers see peer to peer lending as way to fund deposit
Over half of first time buyers in the UK expect to reduce the wait to own their home by at least six months by using peer to peer lending, it is claimed. A poll of customers by peer to peer lending service Zopa, found that two thirds aged 18 to 40 who don't own a home are using it to help raise a deposit and over half expect it to reduce the time it will take to reach buy a home. Some 34% of those surveyed said it will shave more than a year off the time until they can buy and a further 21% say it will reduce their waiting time by six months. The poll also found that 22% are hoping to buy in less than a year, whereas 47% hope to purchase a home between one and three years’ time. Of those looking to buy, over half are cutting back on clothes and other purchases and more than two out of three people are eating out less, going on fewer or cheaper holidays and choosing cheaper options for household essentials to boost their savings. In contrast, one in four people are making no lifestyle changes at all. Of those who weren’t saving for a deposit, 33.8% said it was because house prices are too high and almost a quarter said they have other savings priorities at present. The firm said it is alarmingly that over 40% of people are aiming to save a deposit of over £40,000, but this rises to 55% of people in London who are waiting to buy. This stands in stark contrast to those who brought 10 years ago, when only 2% of savers aimed for a deposit of £40,000 or above. The survey also found that 18% are receiving help from government schemes, such as Help to Buy but 55% expect to receive no financial assistance from their families in reaching their deposit target. For those first time buyers that have had financial assistance, the size of parental contributions is actually getting larger as deposit amounts increase. For those who brought their houses more than 10 years ago, only 8% of parental contributions were over £45,000. This percentage rises to 28% for people who brought less than a year ago. ‘Buying a home is a major milestone in many people’s lives and saving a deposit is getting harder each year as prices and the amount required increases,’ said Zopa’s executive chairman Giles Andrews. Continue reading
US home owners wary as housing market slows
Home owners in the United States are wary of where the housing market is going, while rising prices in some markets are driving renters away from home ownership aspirations, a new report has found. Overall, home owners are confident about the current state of the housing market, but they are less exuberant about future market performance, according to the mid-year results of the Zillow Housing Confidence Index (ZHCI). Millennials are ready to buy in slowing housing markets, but they are dialling back their plans to buy in red hot tech markets like Denver, Seattle, and San Francisco, the index report points out. Also, some 4.9 million renters say they plan to buy in the next year, down from 5.2 million in January, the survey of 10,000 renters and home owners also shows. That is down from 12.1% to 11.4% in the first six months of this year. A smaller percentage of those surveyed said it was a good time to buy. The percentage of those surveyed who believe people who have recently bought a home will be better off in 10 years fell from 61% to 59%, the data also shows. ‘The housing market is slowing down, and Americans' confidence in the future of the market is understandably fading a bit, too. Despite remaining quite confident overall, homeowners are less confident about the future than they are about the present,’ said Zillow chief economist Svenja Gudell. ‘Seeing still stronger than normal home value appreciation in markets like San Francisco and Seattle might remind them of the last housing bubble. But the good news is things are levelling off with no crash in sight. If incomes rise to keep up with home values people can count on home ownership in their future, even in hot markets,’ added Gudell. The report says that home value growth has slowed in almost all housing markets this year, giving homebuyers some breathing room. In those markets with marked slowdowns, many more buyers are looking to buy their first home. For example, 8% of Philadelphia renters said they planned to buy within a year in the January survey, when home values were rising at a 3.1%. In July, when Philadelphia home values were flat, 18% said they planned to buy within a year. And many of those new potential buyers are millennials. Just 1% of 18 to 34 year old Philadelphia renters surveyed in January planned to buy within a year, but that had increased to 23% in the July survey. The opposite occurred in markets where home value growth, despite having slowed overall, is still well above national norms. Here, renters are less optimistic about their buying prospects. In San Francisco some 18% of 18 to 34 year old renters planned to buy a home within a year when asked in January. At that point, San Francisco home values were rising at a 7.9% annual rate. In July, home values were up 11% year on year, and only 5%… Continue reading
Charity calls for new UK garden cities to remain affordable
Homes in existing and proposed garden cities in the UK should be exempt from the proposed extension of the Right to Buy scheme, it is claimed. According to the Town and Country Planning Association (TCPA), a housing and planning charity, this would ensure that garden cities remain socially mixed and affordable places to live. ‘Garden cities built today must have a primary focus on providing homes for everyone in society and in particular those most in need in the current housing crisis,’ Kate Henderson, TCPA chief executive told the charity’s Planning Research Convention. ‘That means that garden cities must include genuinely affordable housing for essential low paid workers whose employment underpins an economy on which we all depend. Garden Cities must also deliver intermediate forms of tenure for people on average incomes trying to get onto the housing ladder,’ she added. The extension of the Right to Buy to housing association tenants, a measure proposed in the forthcoming Housing Bill, has potentially significant implications for the housing offer in both existing and new garden cities according to the TCPA. ‘While the implication of the proposed extension to the Right to Buy in garden cities is not yet known, if there is a genuine commitment to new garden cities by Government then they will have to include a mix of housing types and tenures, as well as providing social and affordable housing in perpetuity,’ Henderson explained. ‘That is why we are calling on Government to provide clarity about whether existing and proposed new garden cities can be exempt from the extension of the Right to Buy,’ she added. She pointed out that in Letchworth Garden City today around 30% of homes are socially rented which is part of the town's success. ‘We believe there is a strong case for existing and new garden cities to be exempt from the proposed extension of the Right to Buy to ensure they are, and in the case of Letchworth remain , vibrant, socially mixed and affordable places to live,’ Henderson concluded. This autumn the TCPA will produce a series of guides designed to provide more detailed information and best practice examples to support those engaged in delivering visionary new garden cities. The guides are intended to be an important resource for a wide range of public and private sector practitioners engaged in the creation of new communities. Continue reading
