New homes need to be built for the 'new' first time buyer
PUBLISHED: 08:07 05 September 2018 | UPDATED: 08:33 05 September 2018
With first time buyers an ever growing proportion of the new build market, the sort of homes being built for them must adapt to remain in demand, according to recent research by Savills. Tamara Greener, from Savills New Homes, discusses.
Lets discuss the findings which consider the impact of Help to Buy, alongside the changing priorities of first time buyers, highlighting the need for developers to ‘future-proof’ the homes they build.
Our latest ‘Market in Minutes’ report into the new homes market reveals that first time buyers were responsible for over 50 per cent of all new residential mortgages issued across the UK in the first quarter of 2018. With affordability a key issue for this buyer group, ensuring new homes hit the right price point and deliver the right product is key in maximising demand.
As the profile of first time buyers and their priorities change, the products on offer to them must adapt accordingly to remain in demand. The increasing time it takes for buyers to save means many already have children by the time they buy their first home, and, of course, this impacts on the kind of home they are looking for. Indeed, our recent collaborative survey with the NHBC Foundation, ‘Beyond location, location, location: priorities of first time buyers’ found that almost a third of first time buyers who had purchased a new home in the last four years already had children, and were buying a home with more than three bedrooms.
Help to Buy can provide a solution to ‘future-proofing’ by allowing buyers to purchase larger homes by only needing a 5 per cent deposit. When the scheme launched in 2013, 22 per cent of purchases were for detached homes, but by 2017 this had increased to 31 per cent of all sales supported by Help to Buy.
Looking forward, it is important that new homes sales strategies recognise the importance of first time buyers as a group and deliver homes of the right size and at the right price point to maximise their demand. The smaller homes aimed at younger buyers may not capture all of the market potential and Help to Buy should be considered for larger family homes where appropriate. Given the importance of Help to Buy for this market, pressure is growing for the government to confirm plans for the scheme after its current projected end date in 2021 to provide certainty for both developers and prospective home owners in the future.
In Norfolk both Millers Field in Sprowston by Persimmon Homes and St George’s Park in Loddon by Halsbury are ideal for first time buyers looking for a larger family home.
The properties at Millers Field would be suitable for those looking for a family property just four miles from Norwich city centre, close to the park and ride with Help to Buy available. Prices currently start from £261,995 for a three bedroom semi detached house. At St George’s Park in Loddon there is also a good selection of properties available as well as the Help to Buy scheme.
St George’s Park is situated 13 miles south of Norwich and prices are currently starting from £223,000 for a two bedroom end of terrace house. There is also shared equity two and three bedroom houses available from £150,000 for a 75 per cent share.
For more information on both of these schemes please contact Tamara Greener at Savills Norwich 01603 229 222 or visit www.savills.co.uk
Savills New Homes has sponsored this column.