First-time buyers 'cannot afford to purchase homes'

19 March 2010

Written by Steve Olejnik

Buy to let landlords could see more tenants from the first-time buyer sector who cannot afford to purchase their own property.

According to a YouGov survey from the National Housing Federation, 86 per cent of 18-30 year-olds who do not own a home do not have the money to do so even if they wanted to.

For 83 per cent, the thought of buying a home was a "dream" rather than reality.

This suggests that buy to let property is the only option for this group.

While house prices are falling, the large deposit required by borrowers is putting many off entering the market.

Communications manager for the Council of Mortgage Lenders Bernard Clarke said: "On average, now, that's 25 per cent of the cost of the property, which is a very significant amount of money for a first-time buyer to acquire."

This "major problem" means that would-be first-time buyers are effectively priced out of the market, he added.

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