The UK's independent property help portal
July 19, 2007

Young homebuyers struggling to get onto the property ladder

Permalink: Young homebuyers struggling to get onto the property ladder
by Gill Montia

Young homebuyers struggling to get onto the property ladder

The risks are becoming greater for first-time buyers as they face a number of problems to get onto the property ladder.

First-time buyers are borrowing nearly 4 times their gross salary, a record average. Interest rates are at their highest since March 2001 with further rises expected. Property prices are becoming unaffordable and many buyers are having to pay stamp duty. Finally, those with a fixed-rate mortgage will be hit with a huge increase in repayments when their deal expires.

The Council of Mortgage Lenders (CML) has warned that each month that passes, affordability is worsening. Money problems are set to increase so those having repayment issues must speak to their lender immediately.

Official figures demonstrate that the average loan that a young buyer takes on is now at a record £117,000 – up by £10,000 in just 12 months. Lenders are allowing some buyers to borrow up to 6 times their salary. Consequently, there are concerns that many will be unable to make the repayments due to the latest rises in interest rates.

The USA is experiencing difficulties, approximately 6 million people who have no money borrowed 100% of the value of a house right at the top of the housing market, which has since fallen sharply.


Click here to discuss this: Home Move property forums



Related stories to: Young homebuyers struggling to get onto the property ladder



Previous: «
Next: »

Visited 1590 times, 2 so far today