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First time buyers

August 17th 2017
By: Melanie
First time buyers

Since 2000 house prices have gone up at an astonishingly quick rate, according to an article in the Property Wire in 2000 a first time buyer would pay an average of £75,000 for their first home compared to 2016 where the average first time property costs around £211,000. So it's not surprising that people are having to save up for longer to be able to get on the property ladder which in turn has pushed the first time buying age up to be between 25-34 years of age.*

They also state that since the turn of the Century house prices have increased by 181%, and not surprisingly with this price increase the amount of first time buyers getting on the property ladder has decreased with figures showing that they have fallen by 27% from 464,000 in 2000 to 335,750 in 2016.

One of the main problems first time buyers have to face is the deficit between earnings and paying house costs, whether buying or renting, wages just haven’t increased at the same rate as property prices. For the renter this has resulted in it being harder to raise the 25% deposits most mortgage lenders ask for which has meant that they either have to ask the ‘Bank of Mum and Dad’ or BOMD or return home to enable them to save up.

To try and combat this problem the Government has introduced several schemes, including the Help to Buy Scheme. The Government will lend up to 20% of the sale price, which means that buyers will only have to find 5% to buy a property and then take out a mortgage on the remaining 75%. Then for the first five years a buyer won’t have to pay any interest or fees then after this period you will then be charged 1.75%, following this it will then rise with inflation, based on the Retail Price Index plus 1% each year.

If you are looking to buy your ideal first time house why not pop into your local branch of Intercounty.

Source: 14/08/17*