New research is a wake up call for would be home owners
House hunters received two wake up calls this week. The first was it is cheaper to buy a new home than rent. The second was that house prices are predicted to soar by up to 14 per cent over the next 4 years. The two reports point to the same causes as Michaela Lancaster, Miller Homes Sales and Marketing Director explains.
"The breaking news on the housing market came from new research from both the Halifax and the Centre for Economics and Business Research.”
“The latest Buying vs. Renting by the Halifax shows that the cost of buying a home for first time buyers is more that £100 a month lower than renting. The research tracks the changes in the cost of buying and renting a typical 2-bed apartment for a first-time buyer across the UK over the last three years. The average monthly cost associated with buying totalled £567 in July 2011, this was 16 per cent [£110] lower than the typical rent paid on the same property type [£677 a month]. This higher cost of renting is also reported in the LSL Property Services plc. survey that shows that rents have risen six consecutive months with a 0.6 per cent rise in July. The annual rent inflation now stands at 4.2 per cent, with an average monthly rental reported to be £705. This hike in rentals shows no sign of slowing with demand still strong from thousands of frustrated buyers unable to get on to the property ladder.”
“A National Housing Federation study highlights the rise in people renting a property and warns of a generation being locked out of the housing market. The study shows that over 36 per cent of people will be living in rented property by 2021 and refers to the findings of the Oxford Economic Housing Market Analysis published in July which cites the rise in demand for rented property as a consequence of the large deposits required by mortgage lenders, the undersupply of new homes and the strict lending criteria. Its study forecasts that over the next 5 years there will be a 19.8 per cent increase in rents as a result of the strong demand.”
“The undersupply of new homes will according to the Centre for Economics and Business Research [Cerb] forecast, force up house prices too. The research takes in to account a growing population, falling average household size and the shortage of new homes. Cerb predicts house prices to accelerate in the next 4 years and it forecasts a 2.4 per cent rise in 2012, 3.4 per cent in 2013, 3.6 per cent rise in 2014 and a 4 per cent rise in 2015.”
“To put the housing shortage in perspective, in 2006 the Government stated that the housing supply needs to be increased by 200,000 homes each year up to 2016 to meet demands and suppress house prices. Last year there were just 102,830 new homes built.”
Now the good news…
“Mortgage supply is increasing with 49,239 loans approved in July, that is 3 per cent higher than a year ago. New home starts are on the rise in England with 23,470 in the first quarter [up from 20,360 in Q1-2010]. Add to this the continuing low interest rates and the good value to be found right now in new homes right now. If you are thinking of buying, explore all your options as soon as possible. The cost of delaying in a rising market could mean it is now or never!”
Making the deal affordable…
“Miller Homes offer a variety of purchasing options that are tailored to suit a buyers circumstances. These can make a new home more affordable than you would believe and can remove the need for a large deposit.”
“Miller Homes MiWay and the Government backed FirstBuy equity loan schemes offer a stepping stone approach to home ownership. Buyers could pay from just 80% of the price of a new Miller Home now, yet own 100 percent of the property when they move in.There are further schemes available too.”
“Miller Homes Deposit Match scheme helps people that have begun to save for a deposit by doubling whatever they have saved, up to 5 per cent of the property price.”
“MiFamily Deposit sets out to reward family members that assist new buyers with their deposit. This scheme enables family members to fund deposits of up to 20 per cent of the purchase price. The family member that has funded the deposit will earn the equivalent of five years’ interest at five per cent on their investment, paid in a lump sum when the purchaser legally completes the sale.
With 14 developments in the North West a Miller Homes’ location is a good place to start a search. As a taster they currently offer new apartments on the FirstBuy scheme that could cost as little as £41,965* now [80% of the price].
For details and location of all the Miller Homes developments, visit millerhomes.co.uk.
*Subject to criteria.
