The Halifax’s annual First Time Buyer review reveals that First Time Buyer activity increased by more than a fifth in 2014, and reached it highest levels for seven years.
The Halifax have released details of their annual First Time Buyer review which reveals that First Time Buyer activity increased by more than a fifth in 2014, and reached it highest levels for seven years.
Activity levels rose by 22% after recording a similar growth of 23% in 2013, this was the third consecutive year that there has been an increase in activity levels with an estimated 326,500 first time buyers.
During 2014 first time buyers accounted for 46% of all property sales that were bought with a mortgage, which suggests that some of the steps taken to support first time buyers were starting to have an impact.
One of the biggest lifelines that has been offered to First Time Buyers was the introduction of the Help to Buy scheme that allows purchasers to get onto the property ladder with just a 5% deposit, and 80% of those using Help to Buy are first-time buyers.
Craig McKinlay, mortgages director at the Halifax, said: “Improving economic conditions and rising employment levels have also boosted confidence among those thinking about getting on to the housing ladder for the first time.”
‘First time buyers are vital for a properly functioning housing market. Improving economic conditions and rising employment levels have boosted confidence among those thinking about getting on to the housing ladder for the first time, contributing to the significant increase in the number of first time buyers in the past two years.’
In December 2014 the Government announced their Autumn statement that revealed significant changes to the Stamp duty thresholds that are set to further benefit first time buyers.
Under the previous stamp duty system the percentage of stamp duty that purchasers paid was subject to the price of the property and the amount was payable on the whole price of the property, not just the amount that falls within the stamp duty bracket. So for example if a property was sold at £130,000 then a 1% stamp duty was payable on the full asking price resulting in purchasers paying £1,300. Reforms to the Stamp duty system now though means that buyers will have to pay only to that part of the property price that falls within each band which will reduce stamp duty bills for most purchasers.
With first time buyer levels at a five year high it could be a great time to think about marketing your property!