First-time buyers

Citation

(2001), "First-time buyers", Property Management, Vol. 19 No. 4. https://doi.org/10.1108/pm.2001.11319dab.017

First-time buyers

First-time buyers

First-time buyers are back – helping to create a healthy and sustainable property market for 2001, says the National Association of Estate Agents (NAEA). Evidence gathered from NAEA members over the year 2000 shows how the percentage of first-time buyers fell during the first five months of the year, reflecting the strong demand for property and the price surges witnessed at the end of 1999 and at the beginning of the year (see Figure 2). As the market slowed down and demand for properties began to match supply more closely in the middle of the year, first-time buyers began to re-appear.

NAEA chief executive, Hugh Dunsmore-Hardy, said: "First-time buyers are an essential part of a healthy property market, they are often the catalyst for move, driving the market forward. In the early part of the year it was essentially a sellers' market – with demand for properties far exceeding supply and prices rising faster than either inflation or wages. First-time buyers were to some extent squeezed out of the market, faced with finding larger deposits and worried about buying in a property price bubble that some predicted might burst.

Figure 2 NAEA housing market survey 200 trends

"However, as the rate of price rises slowed and sellers became more realistic about asking prices, it became apparent that fears of a 'boom and bust' scenario were unfounded and confidence returned. The summer saw some uncertainty amongst first-time buyers, but since September there has been a sustained growth in their numbers and we see that continuing throughout 2001."

The NAEA's economist, Dr Andrew McLaughlin, has predicted that the affordability of housing for first-time buyers – or lack of it – could prove a key factor over the coming year.

Mr Dunsmore-Hardy said: "The latest figures from members suggest that the housing market will hold up well during the year, although there are still large regional differences based mainly on local economic factors and the availability of new-build properties."