Price of starter homes rises to two year high

October 16, 2014 at 9:00 AM Leave a comment

The average property price paid by first time buyers hit a two-year high in September, as starter homes outperformed the rest of the market, research showed today.

First time buyer 3

The typical cost of a first home soared by 4.1 per cent during the month to stand at £160,218, according to estate agent haart.

But house prices eased across the wider property market as the supply of homes for sale increased, but demand fell.

There were 2.8 per cent more homes put on the market during September than in the same month of 2013, the fourth consecutive month during which supply has increased on an annual basis.

At the same time, the number of new buyers registering with estate agents fell by 6.6 per cent, also the fourth month in a row in which demand has eased year-on-year.

The change in market dynamics led to the average cost of a British home dipping by 1.1 per cent to £203,135, while in London prices dropped by 3.3 per cent to stand at £507,967.

But house price gains remained robust on an annual basis, with prices 6.9 per cent higher than they were a year ago across Britain as a whole, while in London they were a massive 19.8 per cent up.

Despite the easing in the mismatch between supply and demand, competition for homes remained intense, with an average of 10 buyers chasing every home for sale, rising to 16 potential buyers per property in London.

Paul Smith, chief executive of haart, said: “Although our data shows a small slowdown in house price growth on a monthly basis, this must be taken in the wider market context.

“Good mortgage deals are still very much on the table and interest rates aren’t going up for the foreseeable future.

“We have 10 buyers chasing every new property instruction UK-wide, so sellers shouldn’t start sneezing yet. The run up to Christmas has already begun and the market remains strong.”

Property sales increased by 1.8 per cent during the month, to stand 7.2 per cent higher than in September 2013.

But the number of first time buyers registering with estate agents fell by 6.4 per cent compared with a year ago.

People taking their first step on the property ladder put down average deposits of £34,550 during the month, while they borrowed an average of £125,668.

On a brighter note, this group accounted for 44.7 per cent of all mortgages advanced in September, slightly up on 41.1 per cent 12 months earlier.

Today’s figures add to growing evidence that the booming property market is beginning to cool.

Nationwide Building Society said house prices dipped by 0.2 per cent in September, while Halifax said annual house price inflation may have peaked at 10 per cent.

The average home in Britain currently costs £266,976, according to Zoopla.

 

Entry filed under: First Time Buyers, General News. Tags: , .

New build of the month: The Ram Quarter, Wandsworth, south west London Cost of renting hits new high

Why not leave us a comment or share this with the buttons above?

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Trackback this post  |  Subscribe to the comments via RSS Feed


Zoopla Mobile & Tablet Apps

Grab the App

Zoopla.co.uk

Search over 1 million properties for sale or to rent on our site from more than 18,000 agents and developers, including all of the UK's leading names.

Posts delivered hot and fresh to your inbox. Signup for free to subscribe, (No spam... ever) and join over 16,000 others.

Enter your email address below:

Recent Posts

Follow Zoopla

Archives

About the Zoopla blog

The Zoopla property blog is maintained and edited by the Web Content Editor @ Zoopla Property Group Ltd Myra Butterworth.

%d bloggers like this: