CHESTER, England, May 20, 2011 /PRNewswire/ -- With UK market conditions continuing to make it difficult for would-be home owners to get on the ladder, the average age Brits expect to be able to buy their first property is now 38 years old, according research* from moneysupermarket.com (http://www.moneysupermarket.com/mortgages/), the UK's number one comparison site.
Individuals who currently do not own property were asked at what age they expected to be able to buy and how they planned to pay for the deposit on their new home. A whopping 31 per cent, some six million Brits**, claimed they do not intend to buy a property at all.
The number of mortgage products available to first time buyers currently stands at just 1,581, a fraction of the 14,940 available in pre-crunch Britain in July 2007. Over the last year, the number of first time buyer products available has risen by almost 200***, offering some hope for those trying to break into the housing market. There has also been a 47 per cent increase in the number of mortgages available up to 90 per cent Loan to Value (LTV), and the average interest rate has dropped by 2.43 per cent since July 2007, bringing more welcome news for first time buyers; however these changes don't tell the whole story. The average LTV for products available to new buyers is 77 per cent, meaning someone taking out a mortgage on a GBP150,000 property would need a deposit of GBP34,500 - well beyond the means of most first time buyers.
Clare Francis, mortgage spokesperson at moneysupermarket.com (http://www.moneysupermarket.com/mortgages/) said: "The housing market has been hugely affected by the credit crunch and economic downturn, and first time buyers have been hit the hardest. It's easy to see why nearly a third of non home owners do not intend to step foot on the property ladder. House prices may have fallen in many areas but they are still high. This coupled with the need for such a high cash deposit is pushing many people out of the market. There is still limited choice if you have a deposit of less than 10 per cent, and the rates on these mortgages are around 5.30 per cent, which is significantly higher than the most competitive rates. This also means that the monthly repayments first time buyers face are often higher than for those who have larger deposits to put down.. "
"For anyone wanting to get on the ladder, who is renting or living with parents, it's important to think about how they can make cutbacks to help them build up a deposit more quickly."
Saving for a deposit
A substantial 19 per cent of those not currently on the ladder plan to rent until they have saved enough for a deposit. The number of people stuck renting until they can afford to buy is highest in the West Midlands, with one in four (25%) playing the waiting game, compared to just six per cent in Northern Ireland. Due to hugely inflated house prices in the capital, Londoners are the least confident about their purchasing power, with the average age they expect to be able their buy their first home standing at a staggering 43 years old.
When it comes to paying for a deposit, five per cent of those waiting to buy currently have enough money saved, whilst six per cent are hoping that house prices will drop further, lessening the amount they need to save. Shockingly, more respondents planned to play the lottery to pay for a deposit (5%) rather than asking for help from family and friends (4%).
Clare Francis continued: "The fact some people are playing the lottery rather than turning to friends and family for help illustrates how squeezed the nation's finances are at the moment. According to Halifax, average property prices fell by 1.4 per cent in April 2011, so in a lot of ways it should be a great environment for first time buyers. But the difficulty many are having saving for a deposit coupled with the ongoing shortage of competitively priced mortgages for those with small deposits means the market remains extremely tough. However, on the plus side, there is no rush to buy as the housing market looks set to remain subdued for the foreseeable future. Therefore aspiring homeowners can take their time to save that all important deposit without the fear that house prices are going to soar out of reach.
In order to do that, would-be first time buyers should take the opportunity to seek out the highest paying savings account and look to get into the habit of putting money away regularly. It's also worth looking at ways to free up more cash such as using discount vouchers and making sure there are no unnecessary costs being incurred. That way, they'll have more to save and will be able to afford their first home sooner."
Notes to editors:
* Opinium Research carried out an online survey of 2,004UK adults aged 18+ from1st April to 4th April 2011. Results have been weighted to nationally representative criteria.
** Based on a UK adult population of 49,121,000. 254 out 2004 respondents (12.7) did not intend to buy property. 12.7% of 49,121,000 = 6,238,367.
*** Number of first time buyer products available in March 2010 was 1,417 versus 1,581 in May 20011, a rise of 164.
moneysupermarket.com's customer commitment - No other site compares more prices or products - We are independent so only find the best deals for you - The price you see is the price you pay - you don't need to go direct and you won't get a better deal doing so - Your details are safe with us and we wont sell them to anybody moneysupermarket.com compares (at 24th February 2011) - 100 car insurance providers and 76 home insurance providers - 20 broadband providers and 18 energy providers - 27 unsecured loan and 5 secured loan providers - 65 mortgage lenders and 33 credit card providers - 65 savings providers and 32 current account providers. - Over 865,000 mobile phone deals We promise to be clear and impartial - All the products in our full search results tables are displayed in a completely unbiased manner. - We don't add fees or commissions on to the prices we compare. - There may be times when another site compares more companies than us on a particular product, perhaps because of market changes or technical issues. You'll be able to see this and know we are working hard to fix it. We promise to be trustworthy - We never use your data to make unwanted sales calls or send you spam. - We never pass your personal information to third parties unless you give us permission to do so. - Even if you choose to receive additional information from us, you can opt out at any time. - We promise to be supportive. - You can use our community forum to get information and help from other customers.
If you need further help or support, you can contact our sales advisors, customer services agents.
Jemma Green (née Parry) Lansons Communications 24a St John Street, London, EC1M 4AY Direct +44(0)207-294-3642 Email firstname.lastname@example.org Web http://www.lansons.com
'Agency of the Year' 2008 at The Financial Services Forum Awards for Marketing Effectiveness
'Agency of the Year' 2007 (PRCA), 2004 (PR Week), 2002 (CIPR), 1995 (PR Week)
Best City Campaign (PR Week) 2008, Best Public Affairs Campaign (PR Week), 2008
Ranked 9th in the UK's 50 Best Workplaces 2009 (Great Place to Work(R) Institute) and Top 50 for five years in a row
For further information, please contact: Jemma Green/ Duncan Skehens / Victoria Murray Lansons Communications +44(0)20-7294-3642/ +44(0)20-7566-9732 / +44(0)207-566-9708 email@example.com/ firstname.lastname@example.org / email@example.com Clare Francis Mortgage spokesperson +44(0)7595-067-818 firstname.lastname@example.org Paul Lawler PR Manager (Financial Services) +44(0)1244-370317 email@example.com