Lowest level of first time buyers since 1980

14-Feb-2006

Industry figures have revealed that levels of first time buyer activity are at their lowest since 1980.

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First time buyer purchases in 2005 were down to 320,000, which is ten per cent lower than in 2004 and a drop of 40 per cent compared to 2002.

The research, revealed in the Halifax House Price Index, indicates that more affordable housing sites and joint ownership schemes are needed to ensure that activity picks up during the next 12 months.

It also showed that the average deposit for a home has now reached £23,967, which accounts for 17 per cent of the value of a property, emphasising the need for potential buyers to save.

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"We anticipate that the upside for house prices will be limited for some considerable time to come by affordability constraints, elevated debt levels, moderate earnings growth and a weakening labour market," commented Howard Archer, chief economist at Global Insight, in an interview with the Guardian.

However, there had been a recent rise in confidence among aspiring homeowners and the figures showed an increase in buyers in the second half of 2005, suggesting that levels will grow over the coming year.

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