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First-time buyers should 'save and sit it out'
02/07/2008 17:30:00
Prospective first-time home buyers should save as big a deposit as possible while waiting for the property market to correct itself, a property expert has said.
Firstrung, which specialises in housing solutions for first-time buyers, has commented that the mortgage market will return to "some kind of normality" at some point, so for people currently priced out of the market it's worth just "sitting it out".
Paul Holmes, operations director at the organisation, explained: "At the moment with prices falling you are safe in knowledge that you are not missing out on anything, the market is not racing ahead, it is coming more towards prices that you need."
He highlighted the value of not "wasting" money set aside for a mortgage on other domestic commodities, but being secure in the fact the deposit will in future be put "to incredibly good use".
Research from the Council of Mortgage Lenders showed the average first-time buyer obtained loans for 3.3 times their income in April.
The National Housing and Planning Advice Unit estimate that even if house prices were to fall by five per cent this year and ten per cent in 2009, affordability prospects will not improve.
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