Rics: Low-income first timers struggling to get on housing ladder

10-Jul-2008

First-time buyer couples on low incomes are finding it harder than ever to get on the housing ladder, it has emerged.

New figures from the Royal Institution of Chartered Surveyors (Rics) indicate that such couples have to save a year's worth of take-home pay to be able to purchase their first property.

Those in the bottom quarter of earners need around £27,738 to cover upfront fees including the deposit, fees and stamp duty on a house.

"Access to the housing market has deteriorated as the credit crunch has taken hold of the mortgage lender sector," remarked David Stubbs, a senior economist at Rics.

Predicting that first-time buyers will find their path to home ownership "increasingly blocked" throughout the rest of the year, Mr Stubbs continued: "Those who are able to access the housing market will find that a bigger deposit will mean that mortgage repayments are reduced.

"But with real incomes stagnating this will seem like light relief only. Homeowners' finances will continue to struggle with rising food and fuel costs making the burden of mortgage repayments even more difficult."

Property experts suggest that a "stagnation" in real income growth has led lenders to request more money for deposits.

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