Mar 15 2005
First time buyers are paying the price for Britain’s soaring housing market. With the latest figures revealing the number of first time buyers has collapsed as prices escalate out of their reach, Britain’s housebuilders are making a determined effort to help them out.
A recent study reveals that first time buyers are now unable to afford to buy in 92% of British towns. As a result just 361,000 – accounting for 29% of home purchases – managed to get on the housing ladder last year compared to 532,000 in 2002. The age of the average first time buyer has also risen to 34 as younger people give up the struggle to buy a home of their own.
In response, the housebuilding industry is committed to addressing the problem with a number of the country’s leading firms concentrating on building smaller, lower-priced homes to tackle the problems first time buyers face.
Major housebuilding firms, Bovis Homes and Country & Metropolitan have both confirmed they are massively increasing production lower-priced homes specifically to cater for first time buyers. Bovis is boosting production of lower-cost homes by 25% in 2005, whilst Country & Metropolitan is aiming for a similar increase. Other major firms including Barratt and Crest Nicholson have greatly increased their production of affordable homes.
A spokesman for the New Homes Marketing Board which oversees New Homes Week, said: “The massive increase in house prices over the past few years has been driven by a number of factors – notably low interest rates and a buoyant economy. However, the root cause of long term house price rises has been due to the restrictions on new housebuilding which means demand far outstrips supply. This is why house prices have increased by just under 5,000% over the past 40 years – an average of more than 10% a year – whilst annual retail price inflation has been averaging just over 6% over the same period. “Housebuilders recognise the very real difficulties that young people and first time buyers are facing and are doing their utmost to help by boosting their production of lower priced homes. In addition there are a vast range of incentives on offer to help first time buyers. These range from having legal fees or Stamp Duty paid to free fixtures and fittings and generous price discounts. “New Homes Week provides an ideal opportunity for first time buyers to check out what offers are available.”