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Fewer first-time buyers in market

The number of first-time buyers is falling and they are getting older, according to research from Halifax.

The average age of FTBs has risen to 34 in 2001 from 29 in 1974 and the number of homebuyers aged under 25 fell to 11 per cent in 2001 from 32 per cent in 1988.

The number of FTBs has plummeted from a high of around 900,000 entering the housing market in 1988. Last year, there were 568,000 FTBs, 37 per cent lower than 1988.

The average deposit paid by FTBs has more than doubled in the past 10 years. Average deposits are now £13,300 compared with nearly £7,000 in 1990. Deposits in London are more than £34,000 compared with around £6,000 in the North.

The average FTB pays £781 in stamp duty compared with £429 in 1988.

Halifax says the abolition of mortgage tax relief in April 2000 has hit FTBs hard. In 1988, mortgage tax relief reduced mortgage costs for a new FTB by £954.

The research says homebuyers are delaying purchase for a number of reasons, such as having families later, more availability of rental properties and the need to move around for jobs.

Head of group economics Gary Styles says: “House prices have risen very rapidly in parts of the UK over the past few years. As a result, many first-time buyers in the South are finding it very difficult, if not impossible, to get on the property ladder.

“First-time buyers are getting older and have a bigger deposit than their counterparts in the late 1980s.”


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