Increase In Transactions For First Time Buyers
The property market in the UK continues to climb year-on-year, as a result of first-time buyers making more activity, and general growth in the market.
According to the professional trade body Propertymark, the proportion of first-time buyers who made a purchase in August 2021 was 28%. This was an increase from July 2021. This figure was also the highest percentage of new buyers in the property market since 2016.
The reason for this is simple.
Demand for new homes continues to remain consistent throughout every region of the UK due to the first time buyer increase. It’s estimated that there are roughly 15 to 20 buyers for every property on the market. With such high demand, it’s not difficult to see why there are more new buyers entering the market all the time.
Generally speaking, the cheap borrowing rates available for mortgages and other schemes allow first-time buyers to enter the property market. The base rate set by the Bank of England for borrowing rates is usually around 0.1%, which means that it’s possible for borrowers who have lower deposits overall to secure more competitive deals.
In 2021, it was possible to secure an average rate on a two-year fixed mortgage of 1.99%. This was possible with just a 15% deposit. However, it is worth noting that property prices do rise over time in many parts of the country, and there is a lower level of available houses on the market. There are too many people and not enough homes, which is why schemes are introduced all the time to help provide more stable access to housing.
To help with the housing shortage, the UK government did introduce a £300m fund called the Housing Growth Partnership. The partnership is a joint initiative between Lloyds Banking Group and Homes England. The goal is to provide funding to small and medium house building companies in the UK.
The scheme was created with the ultimate goal of creating 10,000 new homes by 2025. There was a scheme of a similar nature launched back in 2016, which was built to reflect the more diverse housing needs of the UK at the time, which were primarily build-to-rent properties and retirement living developments.
However, the new scheme focuses more on sustainability. This is the kind of project which talked more about using modern construction methods, and helping to create national standards for sustainability because 2020 to 2021 were primarily the years in which people began to take more notes of the growing climate change problems.
Prime examples of the project included retrofitting more than 240,000 homes in the social housing sector to help make them more energy efficient, and the fund was available to developers whose projects had a value of up to £75 million. Since the launch of the scheme, there were more than 50 housebuilders that were helped and added in the delivery of more than 5000 new homes. Naturally, those numbers continue to rise with time.
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