FTBs in good news shock!
6/20/2008
Britain’s struggling first time buyers have received some long overdue good news, courtesy of the NAEA...
The last couple of months have had a massive affect on first time buyers with the credit crunch and squeeze on mortgage approvals causing a lack in confidence.
The start of the year saw potential as the figure stood at 14.5% in January, however this has dropped month by month, with last month being the lowest of the year, at 7.7%. This has all changed in May though, as FTB activity increase to 10.6% - a higher figure than the same time last year.
There could be a number of reasons supporting this month’s increase. Agents reported an increase in the number of houses available from the month before, which was 84 in April and risen to 97 in May.
This increase gives the buyer more choices of houses and therefore makes it a buyers market. The difference between asking and sales price also increased to 5.1% which may indicate that people are having to be realistic in order to give first time buyers a chance.
Confidence boost
Chris Brown, President of the NAEA, comments: “The figures from the May survey indicate a slight confidence boost from consumers in the market with a rise in house hunters. A significant improvement is the percentage increase in first time buyer sales.
”This is great news as it suggests a lift in confidence in one of the most crucial groups and shows prices have fallen far enough to enable them to climb on the ladder. The figures reported by agents also highlights that as there are more choices available with the number of houses rising, this potentially gives the buyer more options.
“To maintain more stability or better yet, to restore more confidence, the NAEA continue to urge the government to help the market. We have called for measures such as a stamp duty holiday for first time buyers and temporary tax relief on the mortgage interest of people’s primary residence. We really want to see action from the government to ease pressure and give consumers hope for the future.”
Members of the NAEA also reported that consumer confidence rose slightly in May. The latest housing market survey presents evidence of a stable market, with consistency shown in the number of houses on agent’s books, the number of sales agreed and the time between instruction and sale.
However, from the results shown, there is still a need for reassurance.