First Time Buyers – What lies ahead?
The thought of trying to get on the property ladder as a first-time buyer can be daunting, particularly with the ever-increasing house prices, paying rent or saving for a deposit. This coupled with the acceleration of residential property prices over the last couple of years has made it increasingly harder for first-time buyers to get onto the property ladder. However, could first time buyers ability to get onto the property be changing?
In recent years, the figures show that first-time buyer contributions to housing market activity have actually grown, rising from 25% at the beginning of 2016 to 34% at the start of this year (www.introducertoday.co.uk). First-time buyers are now even more important to the health of the market.
The Autumn Statement by Chancellor Philip Hammond set out a series of measures to boost house building and provide more homes. The government plans to invest more than £7 billion, which will effectively double the capital spending on housing over the course of this parliament. £1.4 billion to deliver an extra 40,000 affordable housing starts by 2020 to 2021 and, in addition, the government will relax restrictions on grant funding so providers can deliver a mix of homes for affordable rent and low cost ownership, to meet the housing needs of people at different stages of their lives.
With the Government announcing a series of wide-ranging measures to reform the housing market and provide more homes for people to buy or rent, first time buyers’ ability to get onto the housing ladder could be changing. The Government has also had talks about developing the ‘Starter Homes Land Fund’, which will support the development of starter homes on sites across England only. Every home will be available strictly for current renters aged 23-40 and, crucially, offering a minimum 20 per cent discount on market values.
There are also a number of mortgage lenders out there who offer loans up to 95% of a property’s value, without needing to sign up for any schemes. According to research, 'the number of first-time buyers rose strongly last year, with 339,000 joining the housing ladder, up 8% compared with 2015', and it is believed this trend is set to continue (www.telegraph.co.uk).
This article was written for general information and is not to be relied on without obtaining specific legal advice. For further advice, please contact either Dipak Odedra or Gary Baber on 01442 872311 in our Berkhamsted office if you would like advice about the legal aspects of buying and selling a home.
This article first appeared in the Hemel Gazette Business Eye March 2017