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The future’s bright…
A savings scheme to encourage first time buyers (FTBs) to build up funds for a mortgage deposit has been welcomed by the Royal Institution of Chartered Surveyors (RICS).
Simon Rubinsohn, chief economist at the group, commented on the tax-relieved savings scheme unveiled by chancellor Alistair Darling in his pre-budget report (PBR).
“RICS has called for such a policy to help FTBs save for a deposit on their first mortgage and the scheme should utilise the existing individual savings account structure by allowing use of the full £7,200 savings limit, as well as being supported by an additional government contribution,” Mr Rubinsohn said.
“A savings scheme is essential to ensure buyers save responsibly for a deposit and do not need mortgages with high loan-to-value ratios,” he added.
Now, the head of a specialist firm helping first-time buyers to get on the ladder has said the future for them is ‘very bright.’
Chief executive of Firstrung, Paul Holmes said the situation of falling prices is increasingly favouring such buyers.
However, he noted, those who are hoping to buy will need to be sure their jobs are safe before doing so and will need a larger deposit - around 15 to 20 per cent - than was the case before the credit crunch.
New buyers will therefore need to save furiously for a deposit, he concluded.
Despite this, he stated, “The good news is while they are saving up for that deposit, house prices will continue to fall and come more in line with affordability and their expectations.”
Land Registry figures for October showed the average house price in England and Wales was eight per cent down in a year to £168,814.
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