The St Neots Bank of Mum and Dad Lent £3.14m Last Year

My analysis has shown that first time buyers purchased 211 St Neots properties up to the end of the last quarter. With wages rising at 2.8%, unemployment at a low rate of 4.2% (decreasing by 0.3% since last year), national GDP rising at 1.87% and inflation at 2.3%, this has given first time buyers a chance to get a good foot hold on the St Neots property market.

Over the last year, prices of a St Neots first time buyer property has changed dramatically - last year the average purchase price for a first time buyer in St Neots was £210,300 and the average deposit was £34,069, meaning my calculations show the average St Neots parents contributed £14,905 of that £34,069 figure.

Going to ‘the bank of Mum and Dad’ can make a huge difference as a lot of parents would contribute massively to assist their children up the property ladder. In fact, in the last 12 months St Neots parents put up a substantial 3.14m towards their families’ deposits, which does make a huge difference, enabling St Neots youngsters who thought they couldn’t get on the housing ladder more able to do so.

With mortgage rates at all-time lows, St Neots first time buyers would probably struggle to make mortgage repayments, but it’s the requirement of the deposit which is the big issue here, even when parents and grandparents are helping out where they can. Despite the assistance, it does little to address the real problems of the housing market, whether people are looking to rent or buy their first home or not.

If you think about it, as a Country we have been fortunate that the older generation, who control the biggest share of the nation’s wealth are so plentiful to those following after. We need to remember though that this generosity is a sign of the issues of the British housing shortage, not its solution.

On another note, did you know 95% of mortgages returned to first time buyers in late 2009 and have been available ever since? Also, lenders like Barclays and many local Building Society’s now offer 100% mortgages (i.e. no deposit) at 2.75% fixed for three years.

People think you need 15%, 20% or even a 25% of a deposit to be a first-time buyer- you don’t! You don’t need any deposits, but (there is always a but!)…

Over the last decade, many renters have upgraded themselves into homes that they (or any generation before them) could never have ever afforded as first time buyers in the past. You see the British housing market started to change and I am seeing a slow but steady attitude chance when it comes to renting. Moreover, those tenants have been able to find the price difference of upgrading from old, unattractive rental properties to plush terraced houses or even semi-detached homes, and it made all of the difference.

Renting isn’t seen as the poor, cheap choice, as many young (and increasingly older) people are becoming more at ease and comfortable with the flexibility offered by private renting a property rather than jumping into home ownership. Overall, St Neots landlords will continue to see growth in renting.

Thank you for reading.