Slump in first-time buyers hits market

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SOUTH Yorkshire is seeing a huge drop in the number of first-time buyers as the “lifeblood” drains out of the beleaguered property market.

New figures show that in October only 16 per cent - or one in six - of sales were to people purchasing their first property, the biggest slump in three years.

Conveyancing expert Steve Taylor, of Atteys Solicitors, said first-timers were the stimulus that kept the property ladder moving.

He added: “The economy we’ve all been living in for the last few years has seen a wholesale shift in the kind of people who are in a position to buy and people with smaller deposits have found it extremely difficult to get a mortgage.

“There are more mortgages available for people who have a 10 per cent deposit than there were a few months ago, but this does not yet appear to have helped to increase first-time buyer numbers.”

Figures from the National Association of Estate Agents show in the boom years from 2003 and 2008 roughly one in three home loans were to first time buyers. This fell to a low point of 10 per cent in December 2008. The figure had rallied to reach 22 per cent in September this year before heading sliding down to 16 per cent.

Wendy Evans-Scott, president of the NAEA, said there was little in the Chancellor’s Autumn Statement that provided comfort to the property market.

She added: “We were disappointed to see that the first-time buyer holiday for Stamp Duty Land Tax is not being extended beyond March 2012.

First-time buyers are the lifeblood of the property market and our recent data shows the number getting on to the housing ladder has reached a three-year low.

“The Government will need to do more to help the fragile first time buyer market.”

Property developers are being urged to build homes to rent as Britons lose the desire to own their own home. Tough lending rules have left many people with no alternative but to rent.

But it can be a blessing in disguise, according to Mohammed Mahroof, of auctioneers Mark Jenkinson and son.

He said: “We are witnessing a change in aspiration. Long term renting, where people can put down roots, can give people the chance to live where they can’t buy.”