First-time buyers 'surprisingly resilient'
Posted: 20 Jun 2006 10:28:14 GMT
Despite the obvious difficulties facing first-time buyers in the UK, they still account for around 40 per cent of all house purchase transactions.
A report from Nationwide concludes that first-time buyers have actually been surprisingly resilient over the years and are continuing to provide support for the flourishing housing market.
Admittedly, the proportion of homeowners in the 20 to 24 age group has fallen from 30 per cent to 20 per cent in the last ten years, but this is does not paint the full picture in terms of the overall presence of first-time buyers.
According to Nationwide, the category also includes a significant number of buyers who are returning to the market after a period in rented accommodation or having moved from dissolving households.
The crucial point about these property buyers is that they are typically older and tend to have higher incomes.
"More importantly, however, such buyers often have access to deposits funded from past increases in house prices which ease them back into the market. In 2005 'returners' may have accounted for up to 20 per cent of all first-time buyers," said Nationwide's group economist, Fionnuala Earley.
But there is no doubt that financial constraints are limiting many in their attempts to find a way onto the property ladder. Once the escalating fees for estate agents have been paid, only five to ten per cent of the 22 to 29 age group in the UK earn enough to afford a deposit of just ten per cent on the average property.