Most first time buyers since 2007
While the amount of deposit that UK first time buyers require has doubled to £32,000, there were more of them in 2016 than at any time since 2007, according to a new report.
Most first time buyers in Britain today will spend at least £200,000 on a property, rising to £400,000 in London, where the deposit alone is typically £100,000.
Many of these buyers are now opting for 30 or 35 year mortgages, to spread the rising cost of homes over longer periods. Around 28 per cent of first time buyers take these length of loans, compared with 11 per cent in 2006. Some lenders offer terms as long as 40 years.
The upturn in numbers of initial buyers has been helped by government initiatives such as the Starter Homes Land Fund, where buyers aged between 23 and 40 receive a 20 per cent discount on market value for developments on brownfield sites. It applies to properties worth up to £250,000 outside London and £450,000 in the city.
“This government is committed to building starter homes to help young first time buyers to get on the housing ladder,” said Housing Minister Gavin Barwell. He argued that the “strong local interest” of many councils has helped to identify hundreds of sites for development.
The first of these properties is expected to reach the market in 2018.