House prices as well as interest rates are rising again, as first-time buyers are taking bigger financial risks than ever before in the fear that if they do not buy now they will never be able to afford to.
Research from Yorkshire Bank shows that less than 20% of people are put off by mortgage terms of more than 25 years. First time buyers are doubly likely than others to place offers above asking price, with many considering mortgages five times more than their salary.
With house prices more than £200,000, the first time buyer is finding it very difficult to get onto the property ladder.
Despite two interest rate rises last year, first time buyers do not seem perturbed as they know the longer they leave it the longer it will take to get on to the property ladder.
The research shows that 28% of first time buyers are so determined to buy that they are going to offer above the asking price immediately. This figure has gone up from 19% in January 2006 and is more than double those willing to pay over the asking price (12%).
Huge loans are not problematic for many, with 61% would be first time buyers prepared to get mortgages of five times their salary.
The Yorkshire Bank however warns that rushing to get onto the property ladder is not the wisest of moves as it could prove to be a huge financial risk with many first time buyers getting a mortgage five times their salary.
This life choice needs to be weighed in relation to the level of debt that might be built up.
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Buy Now or Never is What First Time Buyers Are Doing
Mon, 29 Jan 2007
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