The situation is further confounded by deep-pocketed buy-to-let investors investing in the properties typically favoured by first-time buyers; this is generating an acute shortage of affordable starter homes for would be homeowners. It is also becoming increasingly difficult for first time buyers to find property valued under the stamp duty threshold of one hundred and twenty five thousand pounds.
Commentators are calling for the Government to intervene and address the growing problem of lack of affordable property, one option would be the abolishment of stamp duty for first time buyers. The one percent tax on the average price of a first time buyer’s property is one hundred and eighty thousand pounds - a lot of first time buyers have no savings for a deposit let alone for paying stamp duty.
The mortgage approval rate has also fallen as lenders become wary of how much debt first buyers can take on. First time buyers are also being advised to show caution when considering a mortgage that is worth more than the property they are buying - some first time buyers are looking at one hundred and twenty percent mortgages, with the view to using the extra money to pay for the fees involved with buying.
But there could be a ray of hope for struggling FTB’s (First Time Buyers) as the property market is showing the first signs of slowly and lenders are coming up with inventive ways like co-buying and rent-a-room mortgages to help get FTB’s onto the property ladder and FTB’s will always be welcomed by sellers as they have no chain.
James Quinton is a writer based in the UK. He has had articles published worldwide. Compare mortgage rates
http://ezinearticles.com/?The-Ongoing-Struggle-(For-First-Time-Buyers)&id=630330
