With house prices falling as low as they have, it had to happen that eventually house hunters would take advantage of the prices and begin looking for bargains in the property market. According to research from the Royal Institution of Chartered Surveyors, enquiries from potential buyers have risen for the last three months. This hasn’t happened since 2006.
The research has shown that 7 out of 10 surveyors believe the increased interest in the property market is down to the drop in house prices, and 48% of surveyors are convinced that house buyers can now see the market bottoming out soon, before starting to rise again. The actual drop in house prices, according to the surveyors, is close to 30% in completed sales, as opposed to the 20% that the Nationwide and the Halifax believe it to be.
According to the research, the main source of house buying enquiries has come from existing home owners looking to buy a second home. 38% have seen enquiries come from property investors.
However, it is first time buyers who are struggling to get on the property ladder as large deposits are being sought by most lenders. If you have a 5% deposit available for a new home, you only have three different mortgages available to you at the time of writing. A 10% deposit opens the door to just 88 different mortgage options.
Almost a quarter of all mortgages available now require a 40% deposit or above, making it almost impossible for first time buyers to raise the capital.