First-time buyers expecting price drops may be disappointed – Rightmove

First-time buyers have quickly returned to the property market but they may find that any hopes of the pandemic pushing prices down are dashed, Rightmove claims.

money-house-berriman-eatonThe portal said the number of full property details viewed on its website has recovered from a 35% annual drop at the lowest point during the market closure on April 6th, to now being up 2% on this time last year.

A survey by Rightmove during lockdown found 60% of first-time buyers had postponed their purchase plans but would go ahead after restrictions are eased, while 34% went ahead regardless of restrictions on buying and selling.

There is £60bn worth of the type of housing stock usually sought by first-time buyers currently on the market and asking prices are 2% higher at, on average, £241,891, Rightmove said, suggesting that predictions of large drops are yet to materialise.

This means the average first-time buyer applying for a mortgage would require £24,189 for a 10% deposit or £36,284 if 15% is needed, Rightmove said.

The largest deposit is needed in London at £47,757 for a 90% loan-to-value (LTV) mortgage, rising to £71,635 for 85% LTV.

Buyers can put down the smallest amount in Bradford where an average 10% deposit is £8,995 and an average 15% deposit is £13,492

Miles Shipside, housing market analyst for Rightmove, said:

“Many first-time buyers looking to grab a bargain right now may find they’re disappointed, as on the whole asking prices of all first-time buyer properties up for sale have been holding up.

“There will of course be some sellers who need to sell quickly and may be willing to negotiate on price so it’s worth asking a local agent if there’s any with this predicament if you do now need to lower your budget.

“However, where demand is outstripping supply and it’s an attractive property in a desirable location then an offer closer to the asking price will have a better chance of being accepted.

“If a property is overpriced it’s usually pretty obvious by looking at similar properties up for sale on Rightmove in the same area, or by using sold prices to find out how much properties nearby sold for recently, so this should help prospective buyers feel more confident that they know how much they should be offering.”