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The reported number of first time buyers was on the rise in May, whereas the number of approved buy-to-let approved mortgages fell.
This could be because tax changes and policies have changed recently, making it more difficult and less profiatable to become a landlord, and so rebalancing the housing market.
According to financial services lobby group, UK Finance, in May there were 8.1% more first time buyers compared to the same time last year, and lending was up by 12.5%. In addition, the average first time buyer has an annual salary of £42,000 and has a 15% deposit, with an average age of 30.
The Help to Buy scheme and shared ownership initiatives have all played their part in helping people to buy a property, and without these they would not have been able to afford to buy their own home.
In contrast, the buy-to-let market fell by 9.8% and lending was 22% lower than it was the same time last year. This is due to regulatory and tax changes, and the buy-to-let market could further suffer as the full effect is felt by landlords.
One of the biggest changes was the stamp duty being increased for those buying a second home, making a buy-to-let property unaffordable for some people.
Despite this rise in first time buyers, it’s still difficult for some people to get onto the property ladder. Affordability is a stumbling block for some, and this is reflected in the increase in loan to income multiples.
If you would like advice on buying a property for the first time, contact Derngate Wealth today.
Read more: https://www.theguardian.com/business/2018/jul/12/first-time-buyers-on-the-rise-as-buy-to-let-mortgage-market-falls