Rightmove’s first-time buyer forecast for the last three months of 2012 reveals that 25% of those who plan to buy in the next 12 months will be doing so for the first time, compared to the 40% level before the credit-crunch.
More than a third of prospective first time buyers cite raising enough of a deposit as their single biggest concern.
“The list of challenges to get onto the property ladder seems to be getting longer rather than shorter," said Miles Shipside, Rightmove director and housing market analyst. "Raising enough of a deposit stubbornly remains the major concern for intending first-time buyers, but we are now also seeing how the issues facing second-steppers are affecting the fortunes of first-time buyers in terms of finding a suitable property to buy and local affordability."
Around 29% of prospective first-time buyers indicated that their single biggest concern is ‘finding a suitable property to buy’, up from 24% a year ago. Rightmove’s research shows that the typical first-time buyer is planning to spend around £150,000, but the supply of new properties at or below this level in October was down 5% compared to last year.
More than half of prospective first-time buyers expect to move more than three miles from where they currently live, including 38% who are searching more than five miles away. Lack of suitable choice is a factor, but 62% of prospective first-time buyers stated that they believe asking prices in their local area to be above what they consider to be ‘fair and reasonable’.
Around a fifth of first-time buyers (22%) are expecting to purchase with a deposit of less than 10%.
“Four out of five first-time buyers expect to have a deposit of 10% or more," said Shipside, "showing a growing acceptance of the deposit rules that have become the new norm in their quest to get a roof of their own over their heads. Anything less than that will lengthen your odds of being able to jump onto the home ownership ladder, and it seems a bigger deposit is the spring board where most aspiring first-time buyers are headed in their attempt to make that first rung.”