First time buyers turning to parents as house prices rise

02-Aug-2006

Figures from Nationwide show that house prices have risen by 0.8 per cent over July, but first time buyers have not been put off the property ladder by rising prices.

First time buyers are seeking non-traditional means of financing their own home, as the average price of a house reaches £167,733.

Fionnuala Earley, group economist at Nationwide, said: "In spite of rising fixed rate mortgage costs, affordability has not bitten as sharply as we had expected which suggests that buyers are still able to overcome traditional lending constraints.

"This could be as a result of loosening credit criteria, but also the ability for parents to release their own housing equity to help their children or act as guarantors."

Meanwhile, recent research from both the British Bankers Association (BBA) and the Bank of England has revealed an increase in the number of new mortgages approved over the month.

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