First time buyers - go ahead or wait

[Viviennemary]

Are there any first time buyers here thinking of moving out of rented. I know somebody in this position and I think they should wait to see what happens to prices. I'd hate to see them stuck in negative equity. But they're worried they'll miss the boat. Any thoughts?

No one knows for sure what will happen. Personally, I’d go ahead if I could get a property to last me a good few years rather than 2-3. Interest rates are very low and outgoings will be much lower than rent.

I've said it before but i'll say it again. In the long term, house prices always increase.

If they dont intend on moving for a while or dont need to negative equity wont even come into it. My mortgage is 200 quid cheaper than my rent was so no brainer for me

I’d give it six months. The stamp duty holiday is irrelevant to them, as ftb’s are exempt anyway.

Furlough ending, mass redundancies and Brexit could create a dip in prices. Banks are already removing 5 and 10% deposit mortgages, which indicates they think we are looking at a 10% drop in prices.

I’d give it six months. The stamp duty holiday is irrelevant to them, as ftb’s are exempt anyway

That's not correct. Only exempt on the first £300k. In my part of the country that doesn't buy much at all.

@NotSuchASmugMarriedNow1

I've said it before but i'll say it again. In the long term, house prices always increase.

That’s not the point. If the market takes a dive over the next 6 months, they will overpay their property (and by a significant amount in London potentially). As a first time buyer, they are also likely to move to a bigger place after 5-10 years which may not leave enough time for the price to catch-up (assuming it ever will, Tokyo never did after the late 80s crash despite being an overpopulated city on an island and negative interest for a decades now).

Yes no one knows where prices will be in the future, but considering the mini housing boom and the storm coming to us as mentioned above, it s worth waiting few months to see how things are panning out.

Thanks all. It's difficult. Nobody wants to overpay for a house. And a few articles in last few days about price bubbles.

Stamp duty for FBT could easily come back so I wouldn’t assume they’ll be exempt forever based on the fact they’ve had the relief for 3 years.

OP, prices vary from area to area too so it’s not like every single part of every single county goes up or down by the same amount.

If you think your job is secure and you have a decent deposit then why not?

I would not buy an over-priced flat (be mindful of the current growing cladding and fire safety regulations scandal affecting most new built flats) though, but instead go for a house you can live in for a few years, so even if prices go temporarily down you will have the opportunity to wait for the market to recover should you want to sell.

It depends on what/where you're looking to buy really. New build flat in the SE? Definitely wait.
3 bed semi with a big garden? Probably go ahead.

In my part of the country that doesn't buy much at all.

In most of the country 300k buys a decent property. The average house price in the U.K. is 253k.

We're in this position and waiting a few months to see what happens. We've saved for 5 years so a few more months is nothing. I know that "in the end it doesn't matter", but the fact is I'd rather not take any short-term dips/overpay when I don't have to. I'd much rather get the same thing at a cheaper price if possible, even if the price will go up in the long term. Think we will wait till X-mas then regroup.

Where I am prices are going up. Outside of the city centre. Looks like people realised that 15 min drive is worth the space and price...

Nearly everything sold at their price range even some not very good value for money houses. I don't know why prices haven't dropped a bit. And not many houses coming on the market except a few bigger more expensive houses.

I think if Boris gets his way creating 'GENERATION BUY', first time buyer properties will increase in value rather rapidly. He is planning to ease mortgage lending restrictions and help renters afford the 5% deposit. For every brave buyer who purchases now, there are several waiting in the wings. I think there will be a bit of a flurry if/when Boris uses this new prop to boost prices. If it's where you want to live, can comfortably afford the mortgage and are planning on staying for at least a few years, I'd buy now.

www.telegraph.co.uk/politics/2020/10/02/exclusive-boris-johnson-vows-put-generation-buy-housing-ladder/

Be patient, furlough is not ending yet, STH still got several months to run out of the time.
With this second strict restriction, economy got another blow, no deal Brexit followed after that..no matter how much money government pump into house market, if no secured job as support, no one will risk to buy property even with historical low interest rate.
Next March /April would be total different situation even the government will extend the STH, people want to upsize/downsize already bring forward their plan to buy this year.. So less demand plus struggle economy, high unemployed rate, will all play part in it to bring down price..

From what I've read the biggest hurdle for FTBs is a lack of mortgage deals around since Covid and those that are require a 20% deposit, so around 55-60k for a 1 bed flat in some areas.

@fussychica

From what I've read the biggest hurdle for FTBs is a lack of mortgage deals around since Covid and those that are require a 20% deposit, so around 55-60k for a 1 bed flat in some areas.

Which is what Boris says he is going to fix. He's intending the Government guarantee Generation Rents' bank/pension fund mortgages, so they'll only need to find 5%.