First time buyer property values slump

First time buyers are forcing down property values, according to independent financial website Moneyextra.com.

The relatively small number of first time buyers looking to get on the property ladder is having a dramatic effect on the prices they are prepared to pay. The average property value being considered by first time buyers fell to £170,559 in April, that's down 5.75% on March and down 4.78% on year ago levels; and it's nearly £20,000 or 10.25% down from a peak of £190,040 in December 2007.

However, while the prices first time buyers are prepared to pay appear to be slumping, the average loan-to-value ratio they're taking has crept up to its highest level ever at 82.89% with the average amount first time buyers were looking to borrow in April at £141,369.

At the same time, more of those first time buyers still in the housing market are doing it together! The percentage of first time buyer mortgages with dual income applications has also risen to its highest level ever at 44.79%.

Robin Amlôt, Senior Editor of Moneyextra.com commented, "While it may be getting tougher to get a mortgage now, it would appear that those first time buyers who are in a position to buy are driving much harder bargains with sellers.

"Housing is very definitely a buyers' market now rather than the sellers' market that existing homeowners had become used to."

The average value of mortgages actually agreed by AWD in April was £159,961.03, up 8.19% on year-ago levels.