First time buyer numbers have hit a decade high, according to research conducted by Halifax and published in the Halifax First-Time Buyer Review. The research indicates that 2016 has seen the highest number of first time buyers, at 335,750, since 2007.
According to development finance and real-estate specialist, in 2007 there were 359,900 first time buyers, which falls short of the all-time high in 2006, when there were 402,800 first time buyers. The research shows that the average price of a first time buyer’s house now exceeds £200,000, with the average cost of a first time buyer’s house in London averaging £402,692.
In 2016, Northern Ireland had the lowest average house price for first time buyers, at £115,269. The number of first time buyers entering the market rose by 7.3 percent in 2016. Economists are attributing the increase to higher levels of employment and low mortgage interest rates.
First time buyers have further been assisted in getting a foot on the ladder, through Government schemes such as Help to Buy. This Government scheme lends the first 20 percent of the cost of a newly built home, except from loan fees for the first five years. This means that the home buyer only needs to find a five percent deposit and 75 percent mortgage.
Longer mortgage terms
First time buyers are also taking out longer mortgage terms. In 2016, 28 percent of home buyers committed to a mortgage term of 30 or 35 years. These figures are up from the 11 percent level, recorded a decade ago.
The average age of first time buyers was 30, reflecting the higher purchase price of properties, delayed purchasing through increased levels of student debt and couples having children later in life.
According to Glenn Armstrong, this stands new property investors and developers in good stead. In 2017 there looks to be an increased demand for renovated housing, by the over 30s, and increased demand for rental properties, from students and young professionals.