The changes in the UK housing market over recent years have been well publicised, with many people benefiting from the rising house prices and using their new found equity to fund a more luxurious and extravagant lifestyle through increased borrowing not seen as a problem in todays play today, pay tomorrow world, but what impact is this having on first time buyers the lifeblood of the housing market?
It is often said that the first time buyer is the lifeblood of the housing market. They buy the houses at the bottom of the housing ladder, allowing previous owners to buy at the next level up and so on. Without first time buyers, the housing market would slow down dramatically a process which according to many commentators is starting to happen. In fact, figures quoted by Rightmove suggest that during August, the average house price in London actually fell by 0.1%, and the rest of the UK saw growth of only 0.6% - the fourth month in a row that house prices have increased by less than 1%. In theory, this could mean a light at the end of the tunnel for the first time buyer as at this rate, it wont be too long before house price increases are aligned to the average salary increase of 3-4%. However, its not all great news for first timers as this still means that the average house price in the UK is running at over 240,000. It might take a sustained period of rime before those that have re-mortgaged are willing to sell at prices that first time buyers can afford to kick start the market again.
What does this mean to the first time buyer then? The great housing market boom may have slowed down, but the average Joe on the average salary still cant afford to buy the average house unless he has a huge deposit.
One statistic that parents and young adults alike might find mind-blowing is that the average age of the first time buyer in the UK has increased from 27 to 34 in the last 30 years (according to the GE Money Home Lending and Customer Research Organisation). The research also shows that the number of first time buyers buying with a spouse has decreased from 80% in 1977 to just a third today. This means that the prospect of leaving home and moving into that party pad remains a dream for many.
With so many people getting well into their careers before buying their first place, there are more and more people either choosing or being forced to live in house shares throughout their early working lives. In fact for many graduates, who are in often also burdened by student loans the reality is that they will still be living in student house shares well into their thirties!
For more information on house sharing, or to find housemates, visit www.abodewithme.com
Disclaimer: All information on this site is provided for informational purposes only! By no means is any
information presented herein intended to substitute for the advice provided to you by any health care or other professional
or organization.
