Falling prices 'give first-time buyers purchasing power'

27-Jun-2008

First-time buyers' increased purchasing power provides reason for optimism amid ongoing economic instability, it has been suggested.

A spokesperson for the Building Societies Association (BSA) issued the claim in response to the results of the latest Property Price Tracker survey, carried out by YouGov on behalf of the BSA.

"It is clear that the positive outlook that has characterised the property market for the last few years is now a thing of the past, and people expect prices to fall over the next year," acknowledged Adrian Coles, the organisation's director general.

He revealed that 74 per cent of respondents think property prices will fall over the next year, with a quarter expecting a drop of five to ten per cent.

This needs to be kept in perspective, however, according to the BSA.

"Falling house prices mean that first-time buyers now have more purchasing power," remarked Mr Cole, noting that price inflation has been so great over recent years that a 7.1 per cent fall means most people "still have considerable equity in their property".

Representatives for SmartNewHomes.com revealed this week that economic uncertainty has not put off the majority of first-time buyers keen to get on the property ladder.

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First-time buyers 'not put off' by credit crunch First-time buyers in Scotland 'still keen' to get on the ladder

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