First Time Buyers are wealthier and older

Analysis of the official English Housing Survey by UK Finance found that longstanding demographic factors have led to changes in the characteristics of first-time buyers (FTBs).
According to the 2015-16 data there are fewer very young (16- to 24-year-olds) and older (55 or over) first-time buyers compared with 10 and 20 years ago.
The results also showed that owning a home was becoming increasingly restricted to just the wealthiest people.

Two-thirds (66%) of first-time buyers came from the top 40% of earners, compared to just 58% a decade ago, while three-quarters were from dual income households (up from 66%).
Strong aspirations

UK Finance (previously the Council of Mortgage Lenders) noted that despite all of this, aspirations among those in the private rented sector have not been dented, as 59% of private renters expected to buy at some point in the future.
It said this proportion had remained stable since 2006-07. And was in-line with its own research.
Affordability is the chief concern among potential first-timers with 70% of private tenants who do not expect to buy citing affordability constraints.
And half of those (47%) who had considered applying for a mortgage but had not done so felt they did not have a large enough deposit.

Many factors
UK Finance added that many of the demographic factors changing the characteristics of first-time buyers pre-dated the financial crisis and included:
• Strong inward migration into the UK since the late 1990s, especially among younger age groups;
• An ageing population, with the median age in the UK expected to increase by 6 years by 2080, and the share of over 65s to exceed a quarter of the population;
• Couples marrying later than in previous generations, and having children at an older age;
• And individuals remaining in higher education for longer and forming households at a later age.

There has also been a sustained and significant shortage of new properties being built underpinning these demographic changes during this time

Rob’s comments: This may be true but let us remember that in the 90’s a large majority of F.T.B’s came from people buying their council house. These house were cheaper, mortgages smaller and didn’t require a deposit. Now with R.T.B’s gone the data that shows people being wealthier and older makes since.


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