Skip to content

Two thirds of affordable Homes Purchased by first time buyers

New research has found that two thirds of affordable UK homes are being purchased by first time buyers indicating that many people feel the time is right to step on the property ladder.

UK lenders Halifax have gathered data from its own databases as well as The Council of Mortgage Lenders and the HMRC to conclude that first time buyers made up 65% in affordable housing schemes and that young people in particular were aided by shared equity schemes.

This is a significant development when compared to the 40% of all home purchases made by new home buyers. Various shared equity schemes and shared ownership schemes have helped people step onto the ladder for the first time and many young people are taking advantage of this with 40% of all affordable home buyers being between the ages of 20 and 29. Young people only take up 25% of the market as a whole showing that these schemes have provided them with a way to get onto the property ladder.

Many of these government schemes were designed specifically to encourage younger people and those on a low income to consider buying property. Despite this, many young people are still unaware of how these schemes can help or they don’t have a full understanding of the support available. Only 30% of those between the ages of 20 and 45 have welcomed the schemes and think they encourage people to step onto the property ladder.

The Help to Buy scheme aims to play a role in further developing the housing market and targets all buyers, not just first time home buyers. The second half of the scheme will be introduced in January 2014 and involves a mortgage guarantee to those who want to buy any property, whether it is a new build or an older property.

The price of the average home bought under affordable housing schemes is £167,955 whereas the average for all house purchases is £185,324. The average price of a property bought in London under an affordable housing scheme is £228,560 whereas, in the North East, the average price under the schemes is £132,483. However, the average value of a London property sold under one of these schemes is 25% lower than the regional average for all property. The average price paid by new buyers under the schemes is £141,245.

The affordable housing schemes aim to stimulate the new build sector as well as help first time buyers and have so far shown some success with 75% of properties bought under the schemes being new build properties.

Buying Houses since 1972