Despite the recent slowdown in house prices in London and the rest of the South, the housing market remains an increasingly difficult challenge for first-time buyers to get onto the property ladder.
With an average flat price of £320,481 in the Surrey area, first-time buyers growing up in Surrey or in nearby counties have to find properties that are affordable for their budget and not priced out. First-Time buyers can benefit from Brexit.
A problem with recent housing developments in Surrey is that there is becoming a lesser demand for bigger properties and high asking prices.
“Many asking prices are still at levels never seen and are too high,” says Anthony Webb, from Trenchard Arlidge Estate Agents in Surrey.
Flats are growing in demand across Surrey
Our research team at Hunter Finance earlier forecasted that the first-time buyers market is expected to rise by 12.1% in 2019 which coincides with high-street banks offering the lowest mortgage rates to first-time buyers since 1995. Read more here.
“The number of first-time buyers has been rising steadily since 2012, with the help of government policies such as the Help-to-Buy equity loan scheme,” explains Frances Clacy, an analyst at Savills.
In the last five years, flats have experienced the highest growth for asking prices listed on the Surrey property market. Not only is this because of younger residents from Surrey looking to buy their first property, but working-professionals in London are always being forced to look further away.
“A critical supply-demand imbalance has compounded the affordability issues facing many aspiring homeowners in London,” explains Nick Whitten, associate director of residential research at JLL.
“More and more first-time buyers are turning to the outer boroughs in search of better value housing. However, this new wave of demand is creating significant price growth in outer areas, well in excess of wage growth.”
Recent statistics from the Land Registry show that the asking price for properties saw the fastest growth in one and two bedroom properties in the last five years.
“Investors are more likely to realise a greater return on a smaller property in terms of overall investment, especially if it costs very little at the outset and they have continuous demand to cover any costs,” notes Henry Knight, managing director at Springtide Capital.
Smaller properties have begun to represent a great opportunity for landlords looking to purchase properties to expand their portfolio and for first-time buyers. How can Hunter Finance help?
Steven Herd, founder and chief executive of MyLondonHome has assessed property developers that have invested time and money in this specific market. “They intended to flip [buy and sell on] the apartments and make big profits, but it hasn’t worked out like that, and now they are trying to get out at the smallest possible loss.”
“We’d be much better off with decent quality but lower-spec homes. What’s the point in having private cinema rooms that sit empty and resident’s swimming pools with no one swimming in them; it just seems wrong.”
It’s becoming increasingly important for property developers to meet the demand of current first-time buyers who are looking to buy their first property or relocate in Surrey.
Development finance has enabled countless property developers from getting their property projects underway. Hunter Finance offers dependable and fast development finance without unnecessary bureaucracy.
Prospective property developers can apply for a loan today. If you want more information or have any further questions, contact us on 01825 749721. You can also contact us here and a member of our development finance team will get back to you as soon as possible.