London First Time Home Buyers Face Issue of Lack of Supply
First time home buyers typically face a myriad of issues before purchasing that first piece of property and obtaining a step on the property ladder. Saving enough for the deposit, presenting suitable credit scores to the prospective lender, and making sure the house is a good fit are just a few items on a long list. Now, add to the list the problem of lack of supply and it makes buying a house a major challenge to overcome for anyone just getting a financial start in life.
Recent figures have surfaced which make it even more of a challenge for first time buyers. According to data from the National House Building Council, construction numbers for new builds are lacking, and the problem is considerable within the city limits of London. For the first six months of the year, a little over 12,600 houses have been registered. A house is considered registered only after permission has been given for the build, and before the construction date arrives.
Compared with the first six months of last year, this is a decrease of 16%.
Lack of supply is just the beginning for first time buyers in the capital city. Deposits for homes average three times the UK average which is just under £26,000.
Facing these issues, first timers are lowering their expectations as well as their standards and settling for homes which are of lower quality.
Adrian Gill of Your Move and Reeds Rains commented on this issue, saying: “As demand in the property market remains strong, first-time buyers are willing to accept a home in less-than-perfect condition.”
Gill added: “It may even be the case that some first-time buyers actively select properties with faded decor or faulty kitchens, judging that the reduction they can secure on the asking price is greater than the cost of any required renovation work.”
Outside the city of London, the same situation can hardly be found as every other region is experiencing growth in the numbers of new constructions.