House price rises impacts first-time buyers
A further 14 per cent were able to buy their first house with a hand-out from relatives, bringing the total proportion of first-time property buyers to just 28 per cent – a figure still well below the long-term average.
In the 1980s and 1990s half of all mortgages were borrowed by new home buyers. Back then, first-time buyers were considered essential drivers of the housing market. Now, house prices are being pushed up by homeowners with equity under their belt. With the average first-time buyer deposit at 10 per cent of the property’s value, many homeowners are re-mortgaging to help children meet high house prices
The increasing house prices for first-time buyers is good news for property investors. Although buy-to-let landlords accounted for just 7 per cent of sales last year, 2007 could be a good year.
Experts are predicting that 2007 will see a slower growth in house prices compared to 2006 averaging out at about 4% for the year.