My eye has been caught by a tale of two age groups this week, first time buyers, typically in their 30s and older home owners, typically aged 65 and over.
First time buyers now make up the biggest group in the property market in the UK for first time in 23 years, according to new research from lender the Halifax.
Meanwhile, older home owners are making on average £1,000 a month in equity on their homes, another piece of research has found.
On the face of it, it is great news that first time buyer numbers are rising, up 2% in 2018. But at look at the figures show that although they account for the majority of home purchases for the first time since 1995, growth has slowed.
Indeed, growth in 2018 was at a slower rate than 2017 when it was 7.6% and 2016 when it was 9%. That said, the data also shows that first time buyers overall have increased by 92% from an all-time low in 2008.
I should mention that the research from the Halifax is for buyer with a mortgage, which means that it is worth being aware that a study also shows that those who buy a home with a mortgage pay on average 9% more than those paying with cash.
While the Halifax research also shows that the average price paid for a typical first home has gone up by 39%, from £153,030 in 2008, to £212,473 in 2018, and the average deposit has increased by 57% from £21,133 to £33,252 over the same period.
But deposits paid by first time buyers have come down. The average deposit put down by a first time buyer was 14% of the purchase price in 2008 at £21,366, jumping to 20% in 2009, the highest over the last decade. In 2018 the average deposit has come down to 15% of the purchase price, although the average property price has continued to increase.
First time buyers are putting down an average deposit of £32,841, with those in London needing £110,656, while those in Wales are paying the lowest average deposit of £16,449.
But it is quids in for older home owners who have paid off their mortgage with the research from equity release advisor Key shows that owners in Britain aged 65 and over have effectively earned almost £1,000 a month over the last six months from their properties.
It means that retired home owners’ property wealth increased by £28 billion over the period to a new record high of £1.118 trillion and those in Yorkshire and Humberside recorded the biggest increase at £8,607, followed by those in Wales at £7,875, the North West at £7,546, all better than the national average of £5,889.
In Scotland the average growth was £5,499, in the North East of England it was £4,103 and in East Anglia it was £3,133 while in London the growth was just £1,655 over the whole of the six month period.
I’ll just through another few figures into the mix. People born today are set to have to pay £1.2 million for their first home in the UK at the age of 34, and £4.5 million if they live in London, according to a study from letting and sales agents, Benham and Reeves which looked at historic first time buyer property price data from the Land Registry and how this had changed month to month across each UK region and London borough.
Researchers then projected these monthly price changes forward 34 years to see what the average first time buyer house price could pay at the age of 34, the average age for getting on the housing ladder.
Now this is conjecture, and no one really can say what will happen to the property market over more than three decades. But it is food for thought.
