Majority of first time buyers will not benefit from credit crunch

Recent falls in house prices are unlikely to benefit the majority of first-time buyers, says real estate provider Savills.

The company said a slowdown in the housing market will “provide some opportunities” for first-time buyers.

However, Lucian Cook, director of research at Savills, said it was unlikely to help most as they would still be reliant upon mortgage finance.

Mortgage finance is expected to be harder to acquire as a result of the credit squeeze.

“The first-time buyers who [price falls] will help are those who have accumulated relatively high levels of cash reserves, and who are well placed to buy,” he continued.

There will be less “brochure collectors” and “serial viewers” and thus less competition for property.

“The people who are going to be in the market to buy are really going to be in the market to buy,” said Mr Cook.

The November Halifax House Price Index, released today, found a 1.1 per cent monthly fall in house prices.

This is the third successive month it has reported a fall with the average UK house price now standing at £194,895.

Tags: uk, serial viewers, cent, house, mortgage finance, Mr Cook, estate provider savills, property

Buy-for-uni mortgage has its benefits

Taking out a mortgage for a university residence can be beneficial for students and their parents.

According to Moneyfacts, a so-called buy-for-uni mortgage allows students a mortgage of up to 100 per cent on their property with no deposit.

This can act as a “medium term investment”, according to Darren Cook, head of mortgages, that gives students “independence” and “their own home” while at university.

Mr Cook said: “Obviously it’s going to be seen as a good investment from the parents’ side of things. If you’ve taken a student’s property [for] three or four years or whatever, they can convert it to a … student buy to let scenario and rent out rooms.

“[They can] change the actual funding of that asset or get rid of it a later stage. So it could be a short [to] medium-term investment.”

He added that some parents might not want their children going into communal housing, so aside from an investment another reason for buying might be the social aspect.

Currently, Bath Building Society is the only lender offering a specific buy-for-uni mortgage. It was introduced last April and is given only on properties with four bedrooms or less.

Tags: housing, Mortgage loan, specific buy-for-uni mortgage, buy-for-uni mortgage, Mr Cook