Money Worries ‘Putting Off’ First Time Buyers
Financial concerns are increasingly putting off Britons from entering the housing market, new research shows.
A study carried out by Abbey Mortgages reveals that about two-thirds (64 per cent) of prospective first-time buyers are delaying purchasing a property. The firm indicated that at the beginning of this year some 14 per cent of those who do not currently own their home were thinking of stepping on to the housing ladder. However, an estimated 36 per cent of such consumers are at present looking to do this. Meanwhile, three-quarters of respondents state that anxieties about the future of house prices and the economy as a whole have curbed their enthusiasm for buying a home.
Research from the financial services firm also revealed that 67 per cent of consumers who are now less eager to get a home think that their capacity for money management is under so much strain that they would be unable to afford this type of purchase. Meanwhile, 69 per cent believe that house prices may decrease, with other people concerned that they may lose their job.
Such financial concerns may relate to difficulties in meeting demands for payment on the likes of personal loans, rent costs, credit cards and utility bills.
Commenting on the figures, Nici Audhlam-Gardiner, director of mortgages for Abbey, said: “We know how difficult it is for first-time buyers to get on the property ladder and this is exacerbated by current market uncertainty. As has always been the case, we recommend that homebuyers give serious thought to affordability when purchasing a home and not overstretch themselves.”
Abbey revealed that young people have the greatest concerns about buying a home. At the moment, just two per cent of respondents under the age of 25 are prepared to go ahead with getting a property. However at the beginning of 2008, this figure stood at 11 per cent. Meanwhile, a fall of 58 per cent has been recorded among between people aged 25 to 34, with only nine per cent of these Britons looking to purchase a house during the next 12 months.
In addition the financial services firm indicated that delaying buying a house is most prevalent in Wales and the south-west of England. From the start of January until now the proportion of consumers looking to take their first steps on the housing ladder has fallen from 15 per cent to two per cent. Just over half of people from these regions were concerned about the future of house prices and the economy. Meanwhile, a drop of eight per cent has been recorded among those living in London and the south-east who are planning to purchase a home.
For those consumers worried about their ability to afford getting a house, taking out a low-cost loan could prove to be of assistance. In applying for a loan, borrowers may find that they are able to meet various property-related expenses, such as stamp duty, deposits and moving costs, quickly and effectively. A loan may also be of help to people when it comes to making mortgage repayments. This could be of particular help to a significant number of first-time buyers after Nationwide’s January consumer confidence index revealed that the nation’s financial optimism fell by one point to 85. Meanwhile, the index tracking consumers’ views towards employment and economic dropped to 88.
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