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First-time Buyers

First-time buyer house prices up 10% – ONS

Adam Williams
Written By:
Posted:
20/05/2014
Updated:
20/05/2014

House prices rose 8% in the year to March 2014 with first-time buyer properties rising 10%, figures from the Office for National Statistics have shown.

In March 2014, prices paid by first-time buyers were 10% higher on average than the same month in 2013, reaching £193,000. For existing owners prices increased by 7.2% during the same period.

All nations of the United Kingdom showed positive house price growth with properties in England typically growing 8.5% compared to 4.9% in Wales, 0.8% in Scotland and 0.3% in Northern Ireland.

London continued to see the biggest rise in property values with a 17% increase in the last 12 months. Other areas of England showing large rises include the East (6.6%) and the South East (6.1%).

Discounting London and the South East from the figures, house prices in the rest of the UK increased by 4.7% in the 12 month period.

Richard Sexton, director of e.surv chartered surveyors, said first-time buyers were facing an upwards struggle to get onto the housing ladder.

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“The price-tag on a new home has increased the fastest for first-time buyers, who are already at a disadvantage without equity stored in bricks and mortar,” he said.

“Not only this, first-time buyers typically pay higher rates on their mortgages, as well as having the struggle of building a deposit. Help to Buy is keeping the mortgage market accessible despite these barriers and the number of first-time buyers actually hit a pre-recession high in March. But unless the stock of available homes is rapidly increased, there is a limit to how effective the scheme can be.

“The government must do much more to support the supply side. It is vital that first-time buyers continue to be supported, and that we do not allow them to be priced out of the market. In order to safeguard the supply situation, we simply need to build more homes.”

Nicholas Ayre, managing director of Home Fusion, said: “Vendors will need to be realistic about pricing if they want to secure a sale. This may take a couple of months or so but it will happen as savvy buyers are saying ‘enough is enough’.

“Despite the weekend talk from Mark Carney and Nick Clegg, the housing market is showing signs of correcting itself, without the need for external intervention.”