FTB confidence lying low in property market |
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Tue, 29 Mar 2005 01:00
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Abbey released its first-time buyer (FTBs) quarterly report and revealed that the number of confident FTBs had declined sharply within just 3 months from 18% to a low 5%, with first time buyers being quite diffident about buying their very first property.
When asked for the reasons, 37% of FTBs said that was a dearth of properties in their budget while 29% were just found awaiting a price fall. The figures for those in the wait had however, reduced from a huge 42%, probably following the recent moderate hike in house prices.
| According to Abbey, first-time buyers had always found Stamp Duty a hindrance. Nevertheless with Chancellor Brown's verdict to extend the zero rate ceiling to £120,000, FTB confidence, especially in the inexpensive areas, is expected to receive a boost in the coming quarter.
With the present market conditions absolutely befitting the ‘buyer’s market’ criterion, FTBs can now be seen making a lower offer than the asking price. About 45% believe that it is the apt time for this and 77% of these people are ready to negotiate a price right in the beginning.
However, this is not the case with all FTBs. There are around 43% of the buyers worried about losing their property with a lower offer while 12% deem making a lower offer than the asking price unethical and feel guilty about the whole issue. Furthermore, there were those unaware one in ten FTBs also who just didn’t know that a lower price than the asking price could even be offered.
Most FTBs were also found asking for additional facilities/equipment in the price package, to make their purchase worthwhile. 59% FTBs demanded for lights, 54% for curtains/blinds, 50% for a cooker and 35% for a dishwasher; 34% wanted a washing machine and 33% wished for a fridge freezer.
Actually, prices of properties were seldom affordable for many FTBs to buy on their own. About 21% would take the housing association route and around one-fourth were even considering getting together in a group and making a collective family or friend group purchase.
Regarding the deposit of the property, again only 54% of FTBs could afford it from their savings, while 3% would borrow from their family. There were also about 8% of FTBs who had no intentions whatsoever of paying the deposit and they planned to get a 100% mortgage. Also, the stamp duty relief had enabled quite a few buyers to utilize that money to support a larger amount and had also offered them the opportunity to make better competitive mortgage deals.
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