First time buyers not put off by house prices

The rocketing house prices in the UK over the past few years have seen many homeowners enjoy higher and higher levels of equity in their homes, but at the same time have seen the prospect of home ownership for first time buyers dwindling. However, it seems that the sky high cost of buying a property in the UK these days has not put the majority of potential first time buyers off, with many first timers prepared to get themselves into huge levels of debt, borrow many time the amount of their annual income, and pay extortionate repayments over a number of decades in order to get their foot on the property ladder.

With house prices in the UK rocketing year by year, first time buyers – who do not have the luxury of available equity from the sale of a previous property to rely on – are having to really struggle in order to find a decent deposit as well as having to lumber themselves with huge levels of debt in order to raise the money to purchase a property. And because of the amount that first timers are now having to borrow they are often taking the mortgage out over a longer period – sometimes fifty years or longer – to make the repayments more affordable.

In addition to this the recent interest rate hikes enforced by the Bank of England have made it even more difficult to afford repayments, as the interest charged on what is likely to be a very large loan now stands at five and a quarter percent, having risen three times since last August, when it stood at four and a half percent. Nevertheless, first time buyers are continuing to strive to get their foot on the property ladder, often borrowing money from family members in order to help them out or having family members act as guarantors in order to get the finance that they need.