First-time buyers 'squeezed out' as prices continue to rise

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First-time buyers 'squeezed out' as prices continue to rise

Fri 22nd Sep 2006

More people in Britain are being squeezed out of the property market, according to a study from the social research charity the Joseph Rowntree Foundation.

As house prices continue to rise the future is looking bleak for first-time buyers and those on low incomes in need of affordable housing. The Joseph Rowntree Foundation found that over a third of people in Britain under 40 could not afford to buy a home.

Bernard Clark, spokesperson for the Council of Mortgage Lenders (CML), said: "One of the consequences of the property market at the moment has been the shrinkage in first-time-buyers.

"That situation is unlikely to improve in the near future. Historically first-time-buyers comprise half of all loans for house purchase—that number has fallen to a little more than a third—36 percent. We see it continuing at that level for the next two to three years."

Due to the lack of supply, house prices are continuing to be driven up making the situation even more difficult for those on lower incomes.

The CML predicts that house prices will grow by three per cent in 2007 and four per cent in 2008.

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