First-time buyer numbers dwindling

The number of first-time buyers entering the UK housing market is at its lowest since 1980, according to the fifth annual First Time Buyer Review from Halifax.

Approximately 300,000 first-time buyers (FTBs) purchased a UK property in 2007, some 44 per cent less than were able to do so in 2002, when 532,000 new homeowners entered the housing market.

Tracking the affordability of homes in 483 towns across Britain, the review indicated that the average house is unaffordable for FTBs in a staggering 466 of the 483 towns surveyed. Henley on Thames was found to be the least affordable town for FTBs, while Bootle in Merseyside was the most affordable.

Martin Ellis, chief economist at Halifax, said: "Rising property values have priced many potential first-time buyers out of the housing market.

"When they do enter the market first-time buyers are now more likely to be in their 30s rather than their 20s and buy a flat rather than a terraced house. First-time buyers are buying proportionately more in cities than towns and they opt for convenience over size," he added.

Despite the massive increase in property prices, most FTBs are still able to put down an average deposit of 20 per cent, equivalent to more than one year's earnings.

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