Rightmove survey shows first time buyers coming back into market
Rightmove’s Consumer Confidence Survey for October shows that 26% of people of who intend to buy a property in the next year will be doing so for the first time, up from 22% in July.
The survey also finds that the number of first-time buyers expecting prices to drop over the next year has jumped from 1 in 5 to 1 in 3 since last quarter, suggesting that the prospect of lower house prices may be encouraging those buyers to enter the market. However, while there are tentative signs of a recovery in overall numbers, perhaps spurred on by the prospect of sellers accepting lower prices, the proportion of all those intending to buy accounted for by first-time buyers is still lower than it was a year ago (28%). Miles Shipside, director of Rightmove, comments: “Lower property prices might well strike fear into the hearts of property-owners, but it will be music to the ears of those eager to take their first step onto the property ladder.
The success of agents in convincing sellers’ to be more flexible on price lowers one of the key hurdles faced by first-time buyers and sets a precedent for all sellers in a chain to accept their share of the reductions. The required mobility of the market cannot be satisfied by short chains and cash buyers, and recovery will be quicker if more sellers are willing to negotiate on price and in doing so make it easier for those purchasing for the first time. Everyone with an active involvement in the housing market should be doing their bit to welcome back first-time buyers with both open arms and open wallets”. It is unlikely to be a coincidence that first-time buyer numbers are showing early signs of recovery at a time when the proportion of them expecting lower prices in 12 months’ time is on the increase. However, lenders must still play their part in ensuring this expanding group of intending first-time buyers are able to act.