Repossessions least likely for first-time buyers

The operations director of Firstrung has said that first-time buyers are the least likely group to have their homes repossessed under the current economic conditions.

Paul Holmes said this group is unlikely to face the same difficulties repaying their mortgages as families who have recently upgraded to larger houses.

First-time buyers have tended to take out mortgages that are “very manageable”, with the average loan being £115,000 over the past two years.

In contrast, buyers with mortgages in excess of £250,000 on a four or five bedroom property are likely to have “real problems”, Mr Holmes warned.

Mortgage possession claims, the first stage of the repossession process, increased by 16 per cent in the first quarter of this year, according to statistics from the Ministry of Justice.

“First time buyers who have recently climbed onto the first rung [of the property ladder] are least affected by the problems than any other buyer group,” Mr Holmes commented.

Tags: Justice, mortgage, bedroom property, Ministry of Justice, repossessions, First-time, average loan, first time buyers

First-time buyers turn to families for help

First-time buyers are increasingly being forced to ask family members for help in raising a deposit as the mortgage market tightens under the global credit crunch. Read more

Tags: income, ladder, mortgage lenders, housing ladder, first time buyers, business, First-time

Cash lump sum still needed for overseas mortgages

First-time buyers looking to invest in property outside of the UK will still need a cash lump sum to get an overseas mortgage approved, a property advisor has warned.

BuyAssociation said that it was “quite possible” for consumers to get a mortgage approved on a property abroad, a tactic which can help build up equity quickly.

However, Paul Collins, property editor for BuyAssociation, said that these forms of purchase arrangements can often make getting a mortgage more time consuming, particularly in emerging markets.

“And you will find in a lot of these markets that you won’t be able to get 100 per cent mortgages, so again there is still the issue that you will need some form of cash deposit to be able to actually do that, ” he explained.

A recent study published by UK National Savings & Investments found that 84 per cent of 18 to 30-year-olds believe buying property abroad is a more viable option than buying in Britain.

Tags: overseas mortgages, Mortgages, investments, first time buyers, cash, tactic, Subprime mortgage crisis, First-time

First-time buyers ‘undeterred’ by credit squeeze

Despite a significant tightening of the mortgage market following the US sub-prime crisis, many Brits are keener that ever to get their foot on the property ladder.

According to research by Fair Investment, despite the number of mortgage enquiries seeing an overall decrease in the past few months, the number of first-time buyer enquiries has gone up dramatically.

In the first three months of the year first they were at an average of 56 per cent, while in the last three months they have risen to 74 per cent.

Furthermore, the number of first-time buyer enquiries for 100 per cent mortgages has increased from 77 per cent in the first quarter to 92 per cent in the last three months.

James Caldwell, Director of Fairinvestment.co.uk explains: “Britain’s love affair with the property market is far from over, despite the recent dip and the gloomy forecasts for the next few years.

“Our figures suggest that…first time buyers are still keen to seek out a deal and are fully prepared to opt for 100 per cent mortgages if it means getting their own home.”

Meanwhile, demand for high-end mortgage products has grown, especially for multi-currency mortgages.

Tags: James Caldwell, property ladder, significant tightening, buyer, First-time, first three months

First-time buyers going it alone

First-time buyers are becoming less dependent on their parents when it comes to getting onto the property ladder.

That is according to new research from Abbey, which shows that the number of us expecting help from our parents to put down a deposit has fallen.

Just 9.7 per cent of first-time buyers expect any financial help at all from their parents when it comes to purchasing a property, compared to 23 per cent six months ago.

Despite the move away from parents when it comes to securing your first mortgage, many people (45 per cent – unchanged in six months) still expect help from their parents when it comes to moving into their new home.

“The decline in the number of potential homeowners relying on their parents is a positive indication that first-time buyers are finding alternative ways of funding their homes,” said Nici Audhlam-Gardiner, head of mortgages at Abbey.

“However, despite the decline parents still have a large role to play. With one in ten people still requiring parental help to buy and over half still needing help on moving day, it’s not just the children that feel the financial burden of buying a home.”

The survey also found that the ideal home for those taking their first steps onto the property ladder is a country cottage, followed by a townhouse and a penthouse.

Tags: Audhlam, decline parents, financial burden, deposit, number

First-time buyers making sacrifices

First-time buyers are prepared to give up many of their creature comforts in a bid to get onto the property ladder.

That is according to research from Abbey, which shows that 53 per cent of people are willing to give up their holiday, while 49 per cent would be prepared to not drink alcohol.

Many potential buyers (21 per cent) say that they would sacrifice their independence by moving back to their parents’ home while saving for a mortgage.

A total of nine per cent of those asked are willing to take even more drastic action by splitting from their partner if it meant that they could buy a home sooner.

“With first-time buyers struggling to get onto the first rung of the property ladder, prospective homeowners are having to make big sacrifices to build their finances,” said Nici Gardiner, head of mortgages at Abbey.

“However with a typical first-time buyer taking as long as five years to save up a five per cent deposit, people would need an iron will to sacrifice anything they enjoy for that long.”

Recent figures from the Royal Institute of Chartered Surveyors show that accessibility has got 230 per cent worse in the last ten years due to very sharp increases in house prices.

Abbey says that the average first-time buyer needs to raise £32,784 in order to get onto the property ladder, the equivalent of 81.8 per cent of the average joint income.

Tags: research, surveyors, anything, Gardiner, house

First-time buyers paying £150k

Tags: first time buyers, buyers paying £150k, first time buyer, time, buyer, Business Services, First-time