Are you considering buying your first home? Well we have good news for you, the market is finally taking a turn for the better for the first time since the 2007 recession.
Before the 2007 economic crisis, there were around 86,733 first time home buyers a year, however since then, the number has dramatically dropped down to 47,863 per year, with the North East and Yorkshire having a shortfall of around 4 years’ worth of new home buyers.
Finally, the market future is looking brighter for first-time buyers. If you took the lowest rate mortgage this year, you could save over £2000 in your first year than what you would have paid in 2013. This has been due to a drop in 95% LTV (loan to value) mortgage rates, from 5.37% to 4.43% in the last year. This is a welcome relief for potential first time buyers and the property market giving them the opportunity to one again purchase a home.
The best rates on a mortgage are available to those with a 25% or above deposit saved. However, with new government schemes such as Help to Buy, potential homebuyers are still able to mortgage with a deposit of between 5% and 20%. These government schemes are a temporary solution to bring the numbers of first-time buyers up until they can put in place a more permanent solution to get the housing market back on track.
This is in conjunction with a scheme to increase the number of new builds that have also fallen to a standstill over the last few years. Inevitably this has led to a shortage of affordable homes available on the property market, with the scheme NewBuy aiming to help people buy a newly built home in conjunction with the Home Builders Federation.
People who purchased their homes in 2006/2007 are currently facing difficulties of negative equity due to the property boom, however buying a house now could prove a wise decision for the future with property prices on the rise.
If you are a first time home buyer looking to invest, we are here to help in our Mid-Devon estate agents.