The number of new home owners increased 8% in May while the number of mortgages for landlords dropped 10%. Stamp duty changes from April 2016 are possibly changing the market throughout the UK. With buy-to-let mortgages down, it seems mainly professional landlords and investors are still active in the market today.
London Market Pays Double
Lloyds Bank have stated that first-time buyers in London pay double what their equivalent are paying throughout the UK. This means a longer time spent saving that all important deposit. Despite the higher price tags in the city, Lloyds research shows it is cheaper to buy than rent. Renters spend £1.1m more in their lifetimes than buyers, according to studies.
Comparatively, official figures published in April revealed that in London, house prices were more than 13 times the average earnings. It is getting tougher and tougher for those in the city to get onto the ladder.
17 Years To Save A 15% Deposit!
If you are a single first-time buyer in London, you can now expect to save an average of 17 years for that 15% deposit. This is up from 15 years recorded in both 2008 and 2013. With the rest of the country only saving for an average of 10 years, this is a very harsh reality. Couples obviously have an advantage over single people, with 8% being the average time saving 15% deposits.
Help-To-Buy for First-time Buyers
Luckily, the government’s help to buy scheme provides all first-time buyers with a realistic way to purchase their homes. This scheme shaves years off those savings times with only 5% of the property’s value needed to access the programme. The government then lends a buyer up to 20% of the cost of their newly built homes. Since buyers have their smaller deposit, they then secure a mortgage to pay the balance. This scheme, along with the commitment to build more affordable housing in London, is helping more people to purchase their first home.
Interested in Buying your First Home in East London?
According to Jonathan Samuels of Octane Capital “First-time buyers are in the ascendancy while amateur landlords are beating a fast retreat.” Good news for any first time buyers in London. Henry Wiltshire Nine Elms have lots of East London properties on our books suitable for the first time buyer. If you would like to speak to us just get in touch by clicking on our link below.