The number of first-time buyer house completions stalled in October, as demand began to ebb away at the bottom of the market, new research shows.
According to the latest First Time Buyer Opinion Barometer from Your Move and Reeds Rains, there were 26,500 first-time buyer completions in October 2014 – 0.8 per cent more than a year ago but 1.1 per cent fewer than September.
David Newnes, director of estate agents Your Move and Reeds Rains, comments: “Help to Buy reinvigorated the bottom of the market by adding that vital ingredient – confidence. But other factors have pulled this back over the last few months: confusion over a base rate rise, global uncertainty, falling house prices and an inadequate supply of affordable homes have all contributed to a hesitation among first-timers about whether now is the right time for them to buy.
“Stalling first-time buyer completions is down to dipping demand, rather than mortgages becoming less accessible. Compared to a year ago, there are now more options for first-time buyers unable to save up large deposits to get on the ladder. Cheaper rates have also played a part, by allowing first-time buyers to lock into cheaper monthly repayments.”
The research also shows the average purchase price for a first-time buyer property rose 4.1 per cent year-on-year to reach £152,684 in October 2014. Over the same period, the average first-time buyer deposit has fallen 6 per cent – boosted by a greater variety of options for higher LTV borrowers – and now sits at £26,046, compared to £27,719 a year ago. The size of an average first-time buyer mortgage climbed 6.5 per cent year-on-year in October to £126,638.
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