Rics reports lower first time buyer interest in July

14-Aug-2007

The Royal Institution of Chartered Surveyors (Rics) has revealed that the number of first time buyer inquiries fell in July as more would-be homeowners opted against getting onto the property ladder.

Five interest rates in the 11 months to July are likely to have been at least partially responsible for the fall, according to Rics, with house prices continuing to rise over the same period.

"With interest rates perched at 5.75 per cent and a jump to six per cent a strong possibility, aspiring first-time-buyers are continuing to rent until the market trend becomes clearer," commented Rics spokesman Jeremy Leaf.

However, with many analysts expecting six per cent to be the top of the interest rate cycle, demand may soon rise again once stability returns to financial conditions.

"[We] suspect that these results from Rics are merely a statistical nugget that has been 'pounced upon'," commented Helen Adams, managing director of FirstRungNow.com

"Most aspiring home owners realise that home ownership is a long term project and demand to get on the first step of the property ladder will continue to grow," Ms Adams added.

And Spicerhaart Financial Services reported last week that first time buyers actually saw their share of the mortgage market fractionally increase in July.

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