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FTBs need house prices to fall
30 July 2008
First-time buyers would benefit the most from a correction in prices in the housing market, according to Firstrung.
While the government is proposing a 'rent now, buy later scheme' which will allow households earning under £60,000 to rent and save up for a deposit, the most important thing that could happen for first-time buyers is a drop in house prices.
Paul Holmes, CEO of Firstrung, said: "The state the housing market is at now, it is ripe for a considerable correction and that is the best thing that could happen for first-time buyers."
With the mortgage market continuing to shrink, first-time buyers need house prices to fall so that they can put down a sufficient enough deposit in order to afford a property.
"A reasonable house price and a reasonable level of mortgage, means they can afford to buy their first property," added Mr Holmes.
Research by moneysupermarket.com revealed that 36 per cent of British people think they will never own a property due to the current economic climate.
