Are we experiencing a First Time Buyers dream?
The Halifax House Price Index for July was published earlier this month (Monday 7th August), revealing that despite a slight drop in market activity, the UK’s property market has remained resilient in the face of ongoing economic turmoil. What else did they report ...
Additionally, the Index also found that first-time buyer appetite remains high, with demand amongst the demographic growing despite market turbulence. For many first-time buyers, mortgage rates will need to continue to drop for them to achieve affordability criteria, however falling mortgage rates are likely to result in greater activity in the market, which will lead to house prices increasing.
The great news is that many lenders are now starting to reduce their pricing on mortgage products with one lender reducing rates by up to 0.95% in one update this week.
James King, Director of Kent based mortgage brokerage MAB Kent Ltd, said:
“Demand among first-time buyers is not just holding up, but is firing on all cylinders. We’ve seen more first-time buyers in the past two weeks than in the previous two months. This segment of the market is proving especially resilient.”
“With landlords looking to sell prime first-time buyer properties as prices cool and a general increase in property for sale, aspiring homeowners can see their opportunity to pounce. They are in a much stronger position currently as many people have their properties on the market and building a chain is tricky, whereas if a first-time buyer can come along and save the day, then they can negotiate a better price”.
“For certain first-time buyers, current market conditions are playing out perfectly. Locally, we are seeing a slight reduction in asking prices compared to recent years and for those first-time buyers who can afford their proposed monthly payments, now is a great time to get onto the property ladder at a lower entry price.”
With the money markets gaining confidence following lower than expected inflation data, we could continue to see the cost of borrowing fall. 2-year and 5-year SWAP rates (which influence the pricing of 2-year and 5-year mortgages) have started to drop, which implies that lenders have already priced in any rises in the Bank of England Base Rate and if anything have been over cautious with their initial pricing.
If you’re unsure whether it’s a good time to a buy a home and want some expert advice, give us a call today. We're here and ready to help!