The
Government’s ‘Help to Buy Scheme,’
which brought forward plans to add to purchaser’s
deposits from January 2014 to October 2013, was met
with much interest. Eager first-time buyers, who felt
that they might be able to get on the housing ladder,
were quick to enquire. You can find out if you are
eligible
for Help to Buy here.
One
major mortgage lender reported that, since the scheme’s
announcement on the 13th October, mortgage enquiries
had almost doubled. The home-buying hopes of many
would-be first-time buyers had been dashed from around
2008, when mortgages became tougher to get, and the
house market subsequently plummeted. Recent reports,
however, suggest that house sales are on the increase,
with some potential buyers reporting a huge rise in
the properties that they are aiming for... but do
first-time buyers feel that they are now in a position
to buy, following this announcement, or has the hangover
of the economic recession blighted future aspirations
of home ownership?
A
recent report, published after the Government’s
announcement, suggested that 80 percent of adults
aged under 35 think that it is ‘unrealistic’
to expect to own a home, and so instead spend their
money on ‘treats.’ However 7 in 10 thought
they would be in a position to own their own home
in 5 to 10 years.
The
perception of home ownership often differed from the
reality. 50 percent of the people asked, said that
they would expect to own their own home by now. The
perceptions of the people asked was that 33 years
old was the average age of the first time buyer, after
6 years of saving. These are the people who make up
‘generation rent,’ the group of people
who have moved out of their parents’ home, but
use their salary to rent, and therefore cannot save
for a deposit; the exact people that the Government’s
scheme is designed to help.
Despite
all the publicity around the Help to Buy Scheme, and
other shared ownership schemes,
70 percent of the people asked did not think that
they understood fully the range of mortgage options
available to them.
Kevin
Gibson of Ascot Mortgages “There is still a
lot of confusion around the Help to Buy Scheme with
many potential first time buyers wrongly believing
they do not qualify, or mis-understanding the criteria.
The Help to Buy Scheme is designed to help a very
wide range of people, and therefore most first time
buyers will be eligible for the scheme.”
So,
what is the outlook for first-time buyers in 2014?
Probably that they are making tentative steps towards
increased home ownership, whilst taking stock of the
reality of the situation, and the fact that renting
is becoming more normal. For potential buyers, then,
the best thing to do is get advise off an independent
‘whole of market’ mortgage adviser such
as Ascot Mortgages.
