First time buyers better off during recession

According to the Ability to Buy Index produced by the Royal Bank of Scotland, it was easier for first time buyers to purchase property during the recession in 2009 than it is now in 2012.

Rising living costs have negated any benefit first time buyers might have stood to gain from lower average mortgage payments - at their lowest levels since 2003. On paper, first time buyers should now find it easier to get their foot on the property ladder, with the typical first time purchase house price down 18% compared to the peak of the property market in 2007, and salaries on average up 10% compared to the same time. However, transport, food, and utilities have all gone up in price, meaning first time buyers are struggling to make the numbers work when considering a house purchase.

And although deposit requirements have relaxed slightly compared to a year ago, the Ability to Buy Index still estimates that most first time buyers will have to save for 3 years to gather the necessary money to use for a deposit. Furthermore, the stamp duty holiday that previously advantaged first time buyers is to end in March, which means the property purchase process will be even more expensive. However, it is hoped that falling inflation will help remove or lower the barrier to first time purchasing created by high living costs, and that the continued low interest rates will start to encourage more activity in the property market throughout Northern Ireland and the rest of the United Kingdom.

Property website Rightmove has predicted an increase in first time buyers in 2012, but suggests that a lack of 'first-time sellers' could mean the would-be purchasers face a lack of supply. First time buyers often favour terraces or apartments, but the number of those properties being marketed on the site dropped in the final quarter. It is thought that first-time sellers are having to wait longer to market their property because of negative equity prohibiting them from selling on.

If you are planning to sell, purchase, or remortgage a property in Northern Ireland and need a conveyancing solicitor to handle the legal work for you, contact Wilson Nesbitt solicitors in Belfast by calling 0800 840 9290.

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