First-time buyers are top of the developer target list according to poll
Developers and housebuilders are expected to tap into the growing first-time buyer market, which has accelerated since last autumn’s stamp duty changes.
Last week, United Trust Bank published results from a mortgage broker sentiment poll. The lender’s poll found that the first-time buyer sector offered more potential scope and growth over the next three years for residential developers than any other house buying sector.
Despite the downbeat property market figures, the number of first-time buyers in the UK is more than twice the lowest figure of 72,000 recorded in the first six months of 2009 after the financial meltdown.
The number of first time buyers has now topped 150,000 for the third consecutive year, achieving a 12-year high of 175,500.
The poll surveyed 130 property finance brokers, who ranked the potential for the family home and retirement sectors to grow joint second. The same survey was carried out in 2012, which back then confirmed brokers predicting that the first time buyer market offered most opportunity. Back then the retirement sector ranked bottom but has now leapt to joint second place. Brokers are least confident about the growth potential for luxury flats.
No surprise that brokers believe first-time buyer and family home sectors offering greatest growth potential.
Noel Meredith, Executive director at United Trust Bank, said: “It comes as no surprise that brokers still see the first-time buyer and family home sectors as offering the greatest potential for short-term growth.
There is an enduring demand for good quality, sensibly priced homes all over the country and both these sectors, but particularly the first-time buyer sector, have also benefited from the Help to Buy scheme which was introduced in 2013, after the original poll was carried out.”
Mr Meredith said: “It’s interesting how attitudes have changed towards homes for older buyers, with the housing industry now recognising the UK’s ageing population. Just as the NHS must adapt and evolve, house builders are also seeing the opportunities to build homes for older, but increasingly affluent buyers who wish to live independently for as long as possible but nonetheless benefit from living in homes designed with their needs in mind.”
Alex Reynolds, Financial adviser at Advies Private Clients, said: “Joint mortgages, which allow parents to purchase a property with their child, are becoming more common place and a lot more lenders now offer them – older parents are also realising money from their property to help children into the market, which in turn encourages the equity release and retirement market.
“Product innovation has had a part to play in giving first-time buyers the ability to buy properties that are more expensive and therefore encouraging growth in the sector. Obviously the lower interest rate has helped stimulate growth in these areas and it will be interesting to see how that changes over the next few years.”
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