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4 December 2007

First-time buyers accepting non-existence

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by Kay Mitchell

First-time buyers accepting non-existence

The Home Stretch Survey commissioned by Notting Hill Home Ownership (NHHO) has established that prospective homebuyers are prepared to put their lives on hold in order to get on the property ladder

This generation of people are not socialising, buying less clothes and eating cut-price food in the hope of scraping enough money together to put a deposit down on a house. The survey established that 66% are prepared to live like a hermit in order to save for a property while 59% are buying fewer clothes, 58% are forfeiting a holiday while 53% are reducing their sports and leisure activities.

The survey was based on 1,000 people in the UK (comprising 500 homeowners and 500 home seekers). Alarmingly, some respondents said they are prepared to sell their husband or even a kidney in order to get onto the property ladder.

Mark Vaughan of the Notting Hill Home Ownership said when the borrowing capacity of the UK’s home seeking public is set against the average national house price, the financial shortfall is alarming, and proves that optimism within the first time buyer market does not connect with the reality.

Mr Vaughan added that even if house prices do continue to level off as they are currently, the chasm between average savings and house prices shows no immediate signs of being bridged. Consequently, for the majority of UK home seekers, full property ownership is becoming an increasingly unachievable target, regardless of the lifestyle concessions they are willing to undertake.

The survey also established that many are considering shared ownership, this scheme allows buyers to invest in an initial percentage of a property, paying a mortgage on that percentage and subsidised rent on the remainder to a housing association. 52% of respondents are prepared to go down this route in order to get on the property ladder.

Mr Vaughan concluded that after a decade of rising property prices, shared ownership is becoming increasingly relevant and even a requirement to today’s homebuyer.

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