New figures reveal surge in first-time buyers
Figures released by Halifax reveal the number of first-time home buyers (FTBs) has increased by the largest annual amount since 2001.In 2013, the number of first-time buyers grew by an estimated 22 per cent. This is a significant increase on the 13 per cent rise in 2012 and represents the second consecutive year in which numbers have risen.Although the estimated number of FTBs was the highest annual total since 2007, it remains almost 30 per cent below the average annual total recorded between 2002 and 2007. There were an estimated 265,000 FTBs in 2013.The Halifax report reveals mortgages have become more affordable in recent years. In quarter four of 2013, 30 per cent of disposable earnings were spent on mortgage repayments - a marked improvement on the 50 per cent peak recorded in summer 2007. This improvement is attributed to record low mortgage rates.More areas are now affordable for FTBs than was the case in 2007. For someone on average earnings, the average house price was affordable in a third of all local authority districts (LADs) in the UK. Only five per cent of LADs were affordable in 2007. Martin Ellis, housing economist at Halifax, commented: "The number of first-time buyers is estimated to have grown by a fifth in 2013, the largest annual increase in more than a decade. Low interest rates, improvements in consumer confidence and Government schemes, such as Help to Buy, all appear to have contributed to the rise in the number of first time buyers."The government has repeatedly sought to play down fears that a housing bubble may be developing as a result of its Help to Buy initiative. Recently, however, business secretary Vince Cable told the Telegraph large price rises in the south of England are "worrying" and said the government should not risk jeopardising the recovery by following in the footsteps of Gordon Brown.In Greater London, the average price paid by an FTB is £280,915. This is nearly two-and-a-half times the figure in the north-east, where the average is £105,748.
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