The property market as a whole is suffering from an all-consuming crisis, namely that there is a striking imbalance between supply and demand. This imbalance is causing a ripple-like effect through the whole market, impacting on first-time to experienced buyers.
The Royal Institute of Chartered Surveyors (RICS) reported that there are fewer houses on the market now than there have been since 1978. Homeowners who are looking to sell have no problem in finding potential buyers, the problem comes when they are trying to find somewhere else to buy.
This problem is potentially alleviated by the vast increase in rental properties on the market. There is an on-going battle between first time buyers (FTBs) and buy-to-let landlords. These landlords have greatly increased their market share in replace of FTBs as they have fewer problems in securing mortgages and funds. This has been exasperated by the economic downturn in recent times, meaning many banks and building societies were increasingly cautious when it came to lending money.
The shortage of supply and an 11 year high in demand has resulted in only one thing: a house price increase. The average cost of a home in the UK, according to the latest Government data, was £274,000 in May. This average figure has huge regional variability.
‘Affordable’ Homes?
When considering affordable housing schemes, the average price in London was £323,100, whereas in the North is was £147,400. Research from the Halifax revealed that in the 12 months leading up to May 2015, purchases using affordable housing schemes averaged out at £190,000.
Many of these affordable housing schemes are designed to specifically help FTBs – £190,000 doesn’t scream out as affordable. This increase in price may be a reason why the percentage of debut homeowners fell from 29% in May to 24% in June.
However, schemes such as Help to Buy and New Buy are being utilised, with close to 80,000 FTBs getting a helping hand onto the ladder since Help to Buy’s introduction in 2013.
What everyone needs now is more housing at a realistically affordable price. Before the general election, we heard plenty of promises about how many new homes would be built. Now, the Government needs to act on their pledge.
What can you do now?
Once you find your dream home and have your offer accepted, it’s vital to find a good solicitors to look after your conveyancing needs. This process can be made much smoother and less stressful by instructing an efficient, experienced and caring team. Gorvins’ Residential Property team can make a positive difference to your house move.
To speak to a member of our dedicated team, give us a ring on 0161 930 5151 (a normal landline number and included in mobile minutes). You can also send us an email to enquiries@gorvins.com.
First Time Buyers
We know how hard it is to get onto the property ladder, therefore we our offering our FTBs an exclusive 25% off their conveyancing legal fees. Click here to see our page for more details.