Demand for first time buyer mortgages set to rise

Demand for first time buyer mortgages looks set to grow with the news that the share of the property market taken by those buying their first home increased last month.

Figures published by the National Association of Estate Agents (NAEA) revealed that first time buyers accounted for 13 per cent of the market in December 2007, compared to 10.1 per cent the previous month.

And the compilers of the research highlighted the importance of a sudden rush of smaller properties being placed on the market prior to the full role out of Home Improvement Packs (HIPs) in mid-December.

"A particularly encouraging sign for December was the increase in first time buyer share of the market," said NAEA president, Stewart Lilly. "They have been able to take advantage of lower prices in some areas and the influx of one and two bedroom properties specifically prior to the HIPs roll out.

"We hope this positive trend will continue into 2008. Another interest rate drop would bea very positive move for the struggling first time buyer group - and indeed for consumer confidence as a whole."

Last week, the Council of Mortgage Lenders claimed that, despite tightening credit conditions, the mortgage market was holding up well, with business levels holding up.

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