First Time Buyers in Difficulty with Mortgage Deposits

The Council of Mortgage Lenders has recently reported that first-time buyers are having to turn to family for assistance with funding their first property.

Apparently 46% of people under the age of 30 having to get financial assistance from relatives to raise a deposit according to the Council's latest research.

Whereas most commentators would usually suggest that London would lead the way in this heat is apparently Northern Ireland but as the infamous record of having the highest number of first-time buyers needing relatives for financial assistance to get on to the property ladder. {Buyers receiving help typically put down a deposit of £57,000 in London last year.| The average deposit for property nowadays put down by first-time buyers is apparently £57,000 in London.| A staggering £57,000 deposit is the average deposit now being raised by first-time buyer's for properties in London.) This figure is 100% moral and the average figure being raised in any of the other regions of the United Kingdom which indicates how potentially bad the crisis is in London.

The situation in Scotland is almost up the complete opposite to that in Northern Ireland where first-time buyers were the least likely to get assistance from their parents.

As you would expect the level of assistance varies considerably throughout the United Kingdom. A survey by Alliance & Leicester, the lender, found that the average amount handed over was £18,000 last year.

"There has always been a degree of help for children buying a home but there has been a marked increase in recent years," Bob Pannell, CML's head of research, said. the number of first-time buyers was being held up and supported by the number of these handouts for families.

First-time buyers are being hit by another double whammy in the property market with house prices have doubled over the last five years. The situation with interest rates as for other anti-complications to a more AP stressed marketplace. the Council of mortgage lenders is reporting that the percentage of net salary that is going towards mortgage payments is rising dramatically and now apparently 34% of take-home pay.

The Council for mortgage lenders reported that during last year 80% of the people felt that conditions within the housing market were the hardest they had ever faced.

The council questioned whether the growing trend for families to help their children was a good idea: "For the foreseeable future, the first-time buyer market looks to be sustained by financial help from parents and other relatives. It is not clear whether there is any natural limit to the recycling of housing wealth in this way. Over time, however, the market could become polarised - with children of existing home-owners more likely to become first-time buyers."

As with government initiatives to increase home ownership, family support has the effect of helping to prop up house prices, making it even harder for those without property-owning families to enter the housing market. "What this does, unless supply is increased, is to make it harder for the next generation of homebuyers to enter the market," Mr Pannell said. "It does not address the deep-seated affordability problems. This emphasises the crucial importance of expanding the longer-term supply of housing."

A government spokesman said yesterday: "As a result of a decade of unprecedented growth, rising employment and historically low and stable interest rates there are almost 2m more homeowners than in 1997.

"The government fully recognises the importance of affordable housing for all, and has supported increasing new property completions to over 185,000 today - the highest level since 1990. We want to go further, and reach 200,000 over the next 10 years."

Scott James writes about all sorts of Property issues on the Internet and Check out the following for more information about the above: Real Estate Information / Commercial Property London and Real Estate Insurance