You are here: Home - News -

First-time buyer market growing, says the NAEA

by:
  • 01/07/2002
  • 0
The National Association of Estate Agents (NAEA) sees little justification for increasing base rates...

The National Association of Estate Agents (NAEA) sees little justification for increasing base rates to calm the housing market, despite the Council of Mortgage Lenders’ concerns.

The latest monthly housing market survey from the NAEA shows during May, sales to first-time buyers increased by 5% to 25% of the total, despite price rises of 19% and the increasingly acute shortage of homes available.

NAEA chief executive, Hugh Dunsmore-Hardy, said: ‘As house prices continue to rise, there is talk of the development of hotspots where first-time buyers will not be able to enter the market. Continuing activity at the lower end of the market is an indicator that first-time buyers can still find affordable new homes at the moment.’

He added: ‘We still believe the market will run its course and any action by the Bank of England can only be justified if house price rises threaten to take inflation rates higher than Treasury guidelines. Any resulting action should be modest, so it slows the market rather than causing it to falter.’

The NAEA anticipates the market will slow and adjust in the second half of this year, and that the market will moderate itself.

Chris Cummings, Sun Bank’s marketing director, agreed: ‘It is the first-time buyers that will act as the drag on the market and there is no need to adjust the base rate artificially. At the moment, there is no real difficulty. First-time buyers are older than in the early 1990s, more set in their careers and are better educated ‘ if they take advice there should be no problems of overstretching.’

However, he recommended caution. ‘People should investigate areas, and not get caught in estate agent’s hype. We have seen a lot of postcode creep recently, describing places as being near affluent areas to justify prices.’


Tags

There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.

Profiles

Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.

Marketwatch

Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.

Poll

Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
Read previous post:
LENDER VIEW

The Intermediary Mortgage Lenders Association (IMLA) represents the views of some 25 UK lenders invo...

Close