October Newsletter - First-time buyer activity busiest for almost a decade

In this month's edition, we start off with the news that first-time buyer activity is at its highest level in almost ten years.

Elsewhere, we take a look at the large role that older borrowers are taking on to help their family members get onto the property ladder, we detail the importance of setting a realistic asking price for your property and finally, we offer our top tips for selling your home as the colder months of the year approach.

First-time buyer activity busiest for almost a decade

According to a new report from Zoopla, first-time buyers are continuing to prop up the property market in 2019, with this group responsible for the majority of property purchases this year. Thanks to favourable mortgage rates, as well as more flexible mortgages including a higher loan-to-value ratio, first-time buyers are now in a more favourable position than ever to purchase a property.

It would appear that rather than the current train of thought, which would suggest that first-time buyers are doing anything they can in order to join the market, the reality is that they are taking a much more considered approach. Typically, first-time buyers are looking for three bedroom properties which will provide them with a longer term home to grow into which is a stark contrast to previous generations who began with a “starter property” which they quickly moved out of in order to purchase something larger.

Since 2010, first-time buyers as a group have grown by 85%, according to statistics from UK Finance, and this trend is not stemming.

“First time buyers have been the driving force behind the housing sales market in recent years. Lower mortgage rates, and improving mortgage availability have supported the growth in FTB numbers across the country” explains Richard Donnell, research and insight director at Zoopla.

“Despite increased barriers from high house prices in southern England and mortgage regulations, the appetite to buy their first home remains strong. Whilst the outlook is more challenging in London, growth in FTB volumes is expected to be driven in regional markets where affordability remains attractive, supported by greater availability of higher loan to value mortgages,” he continues.

Older borrowers supporting younger generations onto the property ladder

Independent equity release adviser Key has conducted research which establishes the strong role that retired homeowners are now taking on in order to help their children and grandchildren in purchasing a property.

The research from Key has shown that an increasing number of parents and grandparents are using their own properties in order to help younger family members onto the property market. Almost one fifth of mortgage advisers at Key had received enquiries from older customers with regards to selling holiday homes and buy-to-lets.

Will Hale, CEO at Key, said: “With advisers foreseeing a surge in first-time buyer enquiries, it’s clear that the property wealth of over-55s is increasingly playing an important role in tackling the intergenerational imbalance of property ownership.

“And it is really no surprise, given the fact that the average first-time buyer who wants to secure a good rate as they get onto the property ladder needs to find just over £25,000.

“That said, with the older generation often using their savings and pensions to help raise the deposit, there is a real possibility for this generosity to have a sting in its tail.

“Getting specialist advice which considers all options, including equity release, is vitally important to ensure that they make decisions which will benefit themselves and their families over the long term.”

The important of setting a realistic asking price

Recent analysis from comparison site Zoopla has shown the benefits that are reaped when a property is priced correctly rather than over-ambitiously, with overvalued properties taking up to two months longer to sell.

In addition to a longer sale period for properties which are overvalued, the research also found that by dropping the price in order to attract buyers, these properties also achieve an average asking price of £12,000 less than their more accurately valued counterparts.

“Our research highlights the importance of accurate pricing and reveals the areas where there is the healthiest alignment between a seller’s expectations and what a buyer is willing to pay for a property,” said Charlie Bryant, managing director of Zoopla.

“When a home is valued too ambitiously at the start, or simply overpriced, the sales process can be derailed. Homes can languish on the market for much longer than they should and the vendor loses control of the sale, often leading to price reductions,” he pointed out.

“Agents in Salford, Driffield and Dronfield stood out in our report in aligning their vendor expectations with the realities of the market, and what a potential buyer is willing to pay for that particular house, in that particular location.

“The English and Welsh average sold price, which amounts to 96.3% of the asking price, indicates a market realism, and moreover a market that is transacting good values, despite wider macro-economic and political concerns,” he added.

This research shows the important part which an estate agent plays in those initial meetings, with an over-valuation extremely attractive at first, but damaging in the long-run. If you are thinking of selling your property, then complete your own research so that you can have open and honest conversations with your agent in order to list at a realistic value.

Tips on selling your property as the days get shorter

As the days get shorter, it is more important than ever to present your property in an appealing manner if you are going to attract potential buyers. With that in mind, we have put together some season-specific advice to help you find a buyer…

Let in the light
Never is it more important in the year to keep your rooms bright and airy than during the change between seasons. This is because of how quickly the levels of light fluctuate, turning your lovely property into a less-appealing version of itself, with dark rooms and corners. To avoid this, use uplighters to brighten up your rooms during viewings – this type of lighting can be easily placed into corners or areas which may appear darker. Furthermore, blinds and curtains should be drawn back to allow plenty of natural light and don’t forget to turn any lights on in cupboards etc. to create multiple sources of brightness.

Keep paths clear
During this time of year, leaves may start to fall from the trees leaving debris around your property. Ensure that your kerb appeal is kept to its maximum by clearing away any errand plants and debris from your property, especially on the path to your front door where potential buyers will most certainly be surveying. If you have the time, consider tidying up your flower beds and removing and shrubbery which may not be looking quite as lovely as during the summer months.

Clean, clean and clean again
Of course, presenting your property in a clean and tidy state is a given, but it’s also worth considering any other areas that you can spruce up in order to maximise the available light. Clean your windows regularly to ensure that they sparkle for prospective buyers and let in as much natural light as possible (this will also help with the aforementioned kerb appeal). Clean your front door so that it looks at its best – many of us will have white UPVC doors to match double glazed windows, and if this is the case then use some bleach to rejuvenate it.

Increase the pressure
You want your property to seem cosy and inviting, and the drop in temperature gives you the perfect chance to make your home comfortable and welcoming. Turn the thermostat up so that during viewings your property is warm and incentivises viewers to really take their time looking around before they brave the cold weather once more. If you have a fireplace, think about lighting it up or at the very least light some candles.