First time buyers lowest in quarter of a century: Halifax |
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Sun, 29 Jan 2006 20:05
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LONDON - New research by Britain's biggest mortgage lender, the Halifax has shown that the number of first-time homebuyers has hit a record low in 2005 in the last quarter of a century. The report says that about 320,000 people made some purchases last year, but this figure was 10 percent less than that of 2004 and 40 percent less than that of 2002.
"First-time buyers need to save harder and for longer than ever before so as to put down a decent deposit on a house," said Tim Crawford, group Economist at Halifax. "This explains why the number of first-time buyers entering the market was close to record lows in 2005."
The report said that a person needs to deposit £24,000 for his/her first home and is aged 33 at an average when doing so. The number of first time buyers slid to the lowest level since 1980, but there was a marginal rise in the latter half of the year. As far as the deposit is concerned, the Halifax report said that it was 76 percent of average earnings in 2005 as compared to 42 percent of average earnings in 2000.
Halifax also said that most first time buyers are "priced out" of the market. This was true with regard to semi-detached property in 87 percent of the towns as compared to 41 percent of the towns three years ago. Expectedly areas in London and the South East were the most expensive, while Nelson in Lancashire was the most affordable.
The average for a first home across the country is £137,122, but only a small percentage spend less than £100,000 on their first homes in Scotland and the north of England. People in London spent the highest for their first home at £222,005 followed by £163,253 in the South East.
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Government figures show a marginal drop in house price inflation 