The Government’s Funding for Lending scheme has resulted in some thawing in the mortgage market and Government-backed schemes such as Newbuy and Firstbuy are providing a lifeline for an increasing number of people who would otherwise be excluded from home ownership.
On average across England, without assistance from a Government scheme or other help, somebody in their 20s wanting to purchase the average first time buyer home (£175,265) would have to save a deposit of £35,053. Even saving 33% of their net income it would take them nearly seven years – 83 months – to put together the necessary deposit. In 2002, Continue reading
Communities Secretary Eric Pickles said: "Having consulted carefully, the government has noted the potential danger that introducing consequential improvements would, in fact, discourage people from undertaking home improvements.
"This measure ensures that it will remain straightforward for hard-working homeowners to undertake small-scale home improvements and conservatories."
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The average FTB house in 2007 was bought for £167,417 with a £16,742 deposit. However, the average fall in house value of £7819 means they now only have £8,923 of their original deposit left. Assuming they have been making capital repayments on the mortgage for the past five years, these FTBs would now have paid off £14,600 of the loan, giving them a total of £23,521 equity.
When looking to move, the average house price now is £229,435, meaning a 10% deposit, as well as moving costs for stamp duty, conveyancers and estate agents amounts to £29,985, leaving a gap of £6,464 Continue reading
When it comes to how much financial assistance they had, more than a third (35%), said they received up to 10% of their property’s sale price as a deposit, and one in three (30%) received the equivalent of a 20% deposit.
"Getting a first footing on the property ladder is a big step, and huge financial commitment," said Andrew Pearce, Retail Director at Clydesdale and Yorkshire Banks.
"So it’s no surprise that many have to turn to family or other means to find the deposit to secure a mortgage."
The majority (58%) of first time buyers in Wales received up to the value of Continue reading
One in four (25%) said their primary reason for considering such a scheme was that it makes or would make their monthly mortgage repayments more affordable while a further quarter (24%) said it allowed or would allow them to buy in an area which would otherwise have been unaffordable.
The economic downturn has also had an impact on how people view affordable housing schemes, with one in six (15%) of first time buyers saying they would not have considered the schemes previously, but have changed their mind due to the economic conditions.
Eight in ten (81%) first-time buyers claim to have a basic Continue reading
While first-time buyer house prices rose by 4.7% to £141,918 in August, the affordability of both deposits and mortgage repayments improved on a monthly basis as the average income of a first time buyer rose. Deposits in August represented 73% of the average first-time buyer’s annual income, down from 81.7% in the previous month, while mortgage repayments account for 22.2%, down from 23.4% in July.
On an annual basis, the affordability of the average house purchase deposit improved slightly, with deposits representing 0.6% less of a buyer’s annual income. Mortgage payments are slightly less affordable than a year ago, Continue reading
Malcolm Cannon, Chief Executive at ESPC said:
“We know from our extensive survey of over 600 residents in Edinburgh, Lothians and Fife that 90% of people aged 18 to 34 were planning to buy a home in the next five years. Many of those will be first time buyers and they form a vital link in the property chain.
“We are also starting to see a raft of incentives to support first time buyers and that in itself can be a maze of information to work through and analyse. That is why we are hosting our evenings aimed Continue reading
And because first-time buyer properties cost on average £154,991 at the moment, this represents a 25% subsidy.
Furthermore, almost 11% of children who have left home did so with a contribution of more than £100,000 from the Bank of Mum and Dad. Some 7% of respondents say they have bought a house for their offspring outright, while 40% have contributed to a deposit.
A further 11% allow their child to continue living at home for free to save up for the move.
Among parents whose children still live at home, an overwhelming majority said that they would be willing to make significant sacrifices to Continue reading
Karen Barrett, Chief Executive of unbiased.co.uk, said: "Last year we saw a similar ‘spring time’ rise in searches for first-time buyer mortgage advice. This year despite three months of consecutive falls in searches for first-time buyer advice, April has seen the first rise in demand in 2012.
"Over the last weeks we have seen lenders raise mortgage rates and tighten their lending criteria, putting further strain on people wanting to get on the property ladder, which will be a contributing factor to the rise in FTB enquiries."
With last week’s announcement from Halifax that they will increase rates despite the Bank of England Continue reading
The research also reveals the first-time buyers who want to buy and need to raise a deposit, expect to save an average deposit of 16%.
Post Office’s own customer data confirms this, with first-time buyers in 2011 putting down more than 15% on average.
Mike Cook, Head of Mortgages at Post Office, said: "First-time buyers are the life blood of the property market and our research shows that challenging stories about first time buyers and wider economic issues have not dampened aspirations to get on the housing ladder.
"It is also interesting to see that despite the resurgence of 10% deposit mortgages recently, the Continue reading