Affordability problems continuing for first time buyers

First time buyers are in need of long-term solutions to their affordability problems if the issue is to be overcome, with simple solutions such as minimising closing costs unlikely to have that great an effect on their own, it has been suggested.

With the average mortgage now 3.37 times a first-time buyer's average income, Firstrung chief executive Paul Holmes has said that prospective homeowners should wait to see what kind of market slowdown materialises before committing themselves to unrealistic levels of repayment.

"If you are struggling and really pushing the envelope to buy then now is the wrong time to do it. I would advise these first time buyers just to sit and wait and see what the next 12 months brings in house price correction," Mr Holmes commented.

"Not having to pay that initial [stamp duty cost of] £2,500 would be really beneficial but it won't affect the fact they still have to find £250,000 to get on the property ladder. Any benefit would be a help but it doesn’t affect long term affordability," Mr Holmes added.

Nonetheless first time buyers increased their share of the market last month, according to figures from the National Association of Estate Agents (NAEA).



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