Rising house prices may be making it tough for FTBs
29-Jan-2010
House prices have made a strong start to the year - rising by 1.2 per cent in January alone - which could be making the task for would-be
first-time buyers (FTBs) more difficult.
The rise follows an increase of 0.5 per cent in December and figures are now 8.6 per cent up when compared with the same period a year ago, reveals Nationwide.
Adding to the woes of
FTBs is growing uncertainty over interest rates - meaning those who do manage to secure a mortgage for their first rung on the property ladder could be facing unpredictable repayment levels in the future.
Martin Gahbauer, Nationwide's chief economist, said: "With pay inflation near zero or even negative, every additional increase in house prices worsens housing affordability, particularly since interest rates are very unlikely to fall any further."
With the likelihood of being able to afford and secure a mortgage for a new home,
FTBs may want to consider alternative methods - such as
shared equity mortgages or
shared home loans - on which repayments could be easier to make.
The Halifax House Price Index this week revealed that house prices have more than doubled - rising by 105 per cent - in the last decade.
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first property,
first time buyer mortgages,
mortgage advice,
shared equity,
shared ownership,
joint ownership,
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HomeBuy. All a
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Doubling of house prices 'makes life more difficult for FTBs' Securing first mortgage 'is most stressful experience in life' FTBs 'battling to enter less affordable' housing market
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