Articles > First Time Struggle

The number of first time buyers entering the market has fallen to the lowest level for almost thirty years, according to data from major mortgage lenders.

Figures from the Halifax show that an estimated 300,000 people entered the market in 2007, nearly half that of 2002 and the lowest level since 1980. Clearly, going by these figures, people are struggling to get that foothold on the first rung of the property ladder.

Analysis has shown that first time buyers can now not afford to purchase the average house in around 96% of UK towns – just five years ago this figure was much lower, standing at around 30%. Even if you discount the ‘average house’ and look instead at the cheapest (traditionally terraced property), this paints an even bleaker picture – these are unaffordable in 71% of towns, and increase of 60% since 2002.

Henley on Thames was found to be the least affordable area in the study, where the average house price is 13.1 times that of the average income of a first time buyer. At the opposite end of the scale was Bootle in Merseyside, with property 3.4 time higher than income. Even this though is worryingly close to the income multiples that a first time buyer would be offered for a mortgage.

People entering the market are now more likely to be in their thirties, rather than their twenties, and are being forced to opt for smaller property such as flats, as apposed to terraced houses, which were traditionally the domain of the first time buyer.

The future for first time buyers looks uncertain, while house prices are beginning to fall, they are still way beyond the reach of most, and with a recent rate cut, and the possibility of the market picking up again in the first quarter of ’08, getting that first home may just remain a real struggle.