|By Marketwired .||
|January 8, 2014 12:30 PM EST||
LONDON, ENGLAND -- (Marketwired) -- 01/08/14 -- The number of first-time buyers (FTBs) continued to increase in 2013, according to the annual Halifax First Time Buyer Review.
Last year the number of first-time buyers grew by an estimated 22%; the largest annual rise since 2001. This was the second consecutive annual increase following a 13% rise in 2012.
There were an estimated 265,000 FTBs in 2013, up from 218,000 in 2012. While this was the highest annual total since 2007, it was still nearly 30% lower than the annual average between 2003 and 2007 (370,800). FTB numbers increased their share of all house purchases made with a mortgage, now accounting for 45%, up from 40% in 2012 (see Table 1).
Mortgage affordability has improved significantly in recent years. The proportion of disposable earnings devoted to mortgage payments by a first-time buyer stood at 30%1 in 2013 Quarter 4. This is a substantial improvement since summer 2007 when this figure reached a peak of 50%. Record low mortgage rates have been a major contributing factor driving this improvement.
There has also been an increase in the proportion of areas that are affordable for FTBs since 2007. In a third (31%) all of local authority districts (LADs) in the UK the average house price paid by a first-time buyer in November 2013 was affordable for someone on average earnings - based on the ratio of the average house price to earnings being below the long-term average of 4.0. This compares to the peak of the market in 2007 when just 5% of LADs were affordable. The average price paid by FTBs in 2013 was 10% lower than it was in 2007 (see Table 2).
Close to half (45%) of all FTB purchases in 2013 were below the GBP 125,000 Stamp Duty threshold. A similar proportion (46%) of properties bought by FTBs were priced between GBP 125,000 and GBP 250,000. The overwhelming majority (98%) of FTBs in London bought homes above the GBP 125,000 threshold, followed by the South East (87%), and South West (74%) (see Table 3).
Martin Ellis, housing economist at Halifax, commented: "The number of first-time buyers is estimated to have grown by a fifth in 2013, the largest annual increase in more than a decade. Low interest rates, improvements in consumer confidence and Government schemes, such as Help to Buy, all appear to have contributed to the rise in the number of first time buyers.
"However, many potential first-time buyers continue to find raising the necessary deposit a problem. The Help to Buy mortgage guarantee scheme should enable more buyers to get on to the property ladder with smaller deposits. Continuing pressure on household finances during the next 12 months will no doubt remain a constraint."
ADDITIONAL KEY FINDINGS
-- The average FTB deposit in 2013 stood at GBP 30,943; 11% higher than in 2012 (GBP 28,001) and GBP 13,444 (77%) higher than in 2007 (GBP 17,499) (see Table 4). -- FTBs in Greater London put down the largest average deposit, at GBP 56,183. FTBs in the North East put down the smallest average deposit, at GBP 15,862.
-- The average price paid by a FTB is highest in Greater London (GBP 280,915); almost two and a half times that in the North East (GBP 105,748) where the average price paid by a FTB is the lowest (see Table 4).
-- The average age of a FTB is 30 years; up from 29 in 2011. The average age of a FTB is highest in London, at 31 years old. -- There has been a significant increase in the proportion of FTBs receiving financial help in recent years. The CML estimates 65% of FTBs had financial assistance in mid 2012 compared with 31% in mid-2005.
Table 1: Number of First-Time Buyers - UK
============================================================================ Number of First-Time FTBs as % of all Buyers Annual % change House Purchase Loans ============================================================================ 2002 531,800 6% 38% ============================================================================ 2003 369,600 -31% 30% ============================================================================ 2004 358,100 -3% 29% ============================================================================ 2005 363,800 2% 37% ============================================================================ 2006 402,800 11% 36% ============================================================================ 2007 359,900 -11% 36% ============================================================================ 2008 192,300 -47% 37% ============================================================================ 2009 196,600 2% 38% ============================================================================ 2010 198,600 1% 37% ============================================================================ 2011 193,000 -3% 38% ============================================================================ 2012 217,900 13% 40% ============================================================================ 2013(i) 265,000 22% 45% ============================================================================ Source: CML (i)Halifax estimate
Table 2: % of affordable LADs for First-Time Buyers by Region, 2007 and 2013(i)
============================================================================ 2007 2013 ====================================================== Affordable Unaffordable Affordable Unaffordable ====================================================== % % ============================================================================ North East 0% 100% 75% 25% ============================================================================ Wales 0% 100% 50% 50% ============================================================================ Yorkshire and The Humber 6% 94% 76% 24% ============================================================================ North West 9% 91% 71% 29% ============================================================================ East Midlands 5% 95% 57% 43% ============================================================================ Scotland 33% 67% 70% 30% ============================================================================ West Midlands 0% 100% 9% 91% ============================================================================ South West 0% 100% 0% 100% ============================================================================ East of England 0% 100% 0% 100% ============================================================================ South East 0% 100% 0% 100% ============================================================================ London 0% 100% 0% 100% ============================================================================ United Kingdom 5% 95% 31% 69% ============================================================================ Source: Halifax. Northern Ireland has been excluded from the regional analysis (i)2007 refers to 12 months to December. 2013 refers to 12 months to November.
Table 3: First-Time Buyer Purchases by Stamp Duty Thresholds by Region
============================================================================ % of FTB Purchases by Stamp Duty Threshold - January to November 2013 ============================================================================ less than GBP 125k-GBP less than greater than GBP 125k 250k GBP 250k GBP 250k ============================================================================ North 76% 23% 99% 1% ============================================================================ Yorkshire and The Humber 70% 29% 99% 1% ============================================================================ North West 67% 31% 99% 1% ============================================================================ East Midlands 65% 33% 99% 1% ============================================================================ West Midlands 58% 40% 98% 2% ============================================================================ East Anglia 37% 59% 96% 4% ============================================================================ Wales 69% 30% 99% 1% ============================================================================ South West 26% 70% 96% 4% ============================================================================ South East 13% 75% 88% 12% ============================================================================ Greater London 2% 58% 60% 40% ============================================================================ Northern Ireland 85% 14% 100% 0% ============================================================================ Scotland 68% 30% 98% 2% ============================================================================ United Kingdom 45% 46% 91% 9% ============================================================================ Source: Halifax.
Table 4: First-Time Buyers: Average Price, Loan and Deposit by Region, 2013
============================================================================ Average Average Deposit as % Average House Mortgage Deposit of purchase Price (GBPs) (GBPs) (GBPs) price =============================================== ============================ North 105,748 89,886 15,862 15% ============================================================================ Yorkshire and Humberside 112,147 95,183 16,964 15% ============================================================================ North West 115,618 98,127 17,491 15% ============================================================================ East Midlands 121,595 97,576 24,019 20% ============================================================================ West Midlands 129,278 97,213 32,065 25% ============================================================================ East Anglia 149,370 119,670 29,700 20% ============================================================================ Wales 113,932 91,146 22,786 20% ============================================================================ South West 159,319 131,810 27,509 17% ============================================================================ South East 195,259 165,957 29,302 15% ============================================================================ Greater London 280,915 224,732 56,183 20% ============================================================================ Northern Ireland 92,778 78,861 13,917 15% ============================================================================ Scotland 114,781 92,831 21,950 19% ============================================================================ UK 156,701 125,758 30,943 20% ============================================================================ Source: Halifax 12 months to November, CML
Notes to editors:
1 Based on average loan taken out by a new first-time buyer.
THE AFFORDABILITY CALCULATION:
A local authority (LAD) is classified as affordable if the average house price for a First-Time Buyer (FTB) in the LAD is lower than someone on average earnings in the area can pay. Gross average annual earnings for the LAD are multiplied by 4.0 to calculate the amount that someone on average earnings could 'afford' to pay. For example, if average earnings in the LAD are GBP 30,000, someone on average earnings in the area could pay up to GBP 120,000. The LAD is deemed to be affordable if the average price paid by a FTB in the LAD is less than GBP 120,000 and unaffordable if it is higher.
The multiple of 4.0 is in line with the average house price to income ratio for a FTB over the period from 1991 to 2013. (Source: Halifax)
This research is based on data from the Halifax's own extensive housing statistics database and ONS data on average earnings.
1. House Prices
The prices used in this research are simple arithmetic ('crude') averages. These prices are not standardised and therefore can be affected by changes in the sample from period to period.
2. Average Earnings
Average earnings figures are from the ONS's "Annual Survey of Hours and Earnings" (ASHE) and refer to the means for full-time employees.
At local authority district level, figures for the relevant local authority (residence based) are used in the majority of cases. Where this has not been possible due to data unavailability, the relevant regional average has been used.
"This report is prepared from information that we believe is collated with care, however, it is only intended to highlight issues and it is not intended to be comprehensive. We reserve the right to vary our methodology and to edit or discontinue/withdraw this, or any other report. Any use of this report for an individual's own or third party commercial purposes is done entirely at the risk of the person making such use and solely the responsibility of the person or persons making such reliance. "
For the latest housing research, previous releases, and for information on the Halifax House Price Index, please follow this link: http://www.lloydsbankinggroup.com/media1/economic_insight/halifax_house_price_index_page.asp.
Housing Economics Helpline No: 08456 045404
Email: [email protected]
ISDN facilities are available for broadcast media interviews.
Halifax Press Team
01422 332833 / 07881 311199
DevOps at Cloud Expo – being held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises – and delivering real results. Am...
Sep. 25, 2016 03:15 PM EDT Reads: 4,373
Almost two-thirds of companies either have or soon will have IoT as the backbone of their business in 2016. However, IoT is far more complex than most firms expected. How can you not get trapped in the pitfalls? In his session at @ThingsExpo, Tony Shan, a renowned visionary and thought leader, will introduce a holistic method of IoTification, which is the process of IoTifying the existing technology and business models to adopt and leverage IoT. He will drill down to the components in this fra...
Sep. 25, 2016 03:00 PM EDT Reads: 1,548
SYS-CON Events announced today that Bsquare has been named “Silver Sponsor” of SYS-CON's @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. For more than two decades, Bsquare has helped its customers extract business value from a broad array of physical assets by making them intelligent, connecting them, and using the data they generate to optimize business processes.
Sep. 25, 2016 02:45 PM EDT Reads: 2,481
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management solutions, helping companies worldwide activate their data to drive more value and business insight and to transform moder...
Sep. 25, 2016 02:30 PM EDT Reads: 2,304
The vision of a connected smart home is becoming reality with the application of integrated wireless technologies in devices and appliances. The use of standardized and TCP/IP networked wireless technologies in line-powered and battery operated sensors and controls has led to the adoption of radios in the 2.4GHz band, including Wi-Fi, BT/BLE and 802.15.4 applied ZigBee and Thread. This is driving the need for robust wireless coexistence for multiple radios to ensure throughput performance and th...
Sep. 25, 2016 02:30 PM EDT Reads: 1,506
SYS-CON Events announced today that Pulzze Systems will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Pulzze Systems, Inc. provides infrastructure products for the Internet of Things to enable any connected device and system to carry out matched operations without programming. For more information, visit http://www.pulzzesystems.com.
Sep. 25, 2016 02:15 PM EDT Reads: 1,792
SYS-CON Events announced today the Kubernetes and Google Container Engine Workshop, being held November 3, 2016, in conjunction with @DevOpsSummit at 19th Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA. This workshop led by Sebastian Scheele introduces participants to Kubernetes and Google Container Engine (GKE). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, students learn the key concepts and practices for deploying and maintainin...
Sep. 25, 2016 02:00 PM EDT Reads: 2,581
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?
Sep. 25, 2016 02:00 PM EDT Reads: 1,511
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
Sep. 25, 2016 01:00 PM EDT Reads: 819
There is little doubt that Big Data solutions will have an increasing role in the Enterprise IT mainstream over time. Big Data at Cloud Expo - to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA - has announced its Call for Papers is open. Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is...
Sep. 25, 2016 12:45 PM EDT Reads: 2,430
Digital innovation is the next big wave of business transformation based on digital technologies of which IoT and Big Data are key components, For example: Business boundary innovation is a challenge to excavate third-party business value using IoT and BigData, like Nest Business structure innovation may propose re-building business structure from scratch, as Uber does in the taxicab industry The social model innovation is also a big challenge to the new social architecture with the design fr...
Sep. 25, 2016 12:15 PM EDT Reads: 1,094
DevOps at Cloud Expo, taking place Nov 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long dev...
Sep. 25, 2016 12:15 PM EDT Reads: 3,374
Data is an unusual currency; it is not restricted by the same transactional limitations as money or people. In fact, the more that you leverage your data across multiple business use cases, the more valuable it becomes to the organization. And the same can be said about the organization’s analytics. In his session at 19th Cloud Expo, Bill Schmarzo, CTO for the Big Data Practice at EMC, will introduce a methodology for capturing, enriching and sharing data (and analytics) across the organizati...
Sep. 25, 2016 11:45 AM EDT Reads: 1,640
IoT is fundamentally transforming the auto industry, turning the vehicle into a hub for connected services, including safety, infotainment and usage-based insurance. Auto manufacturers – and businesses across all verticals – have built an entire ecosystem around the Connected Car, creating new customer touch points and revenue streams. In his session at @ThingsExpo, Macario Namie, Head of IoT Strategy at Cisco Jasper, will share real-world examples of how IoT transforms the car from a static p...
Sep. 25, 2016 11:30 AM EDT Reads: 1,509
The many IoT deployments around the world are busy integrating smart devices and sensors into their enterprise IT infrastructures. Yet all of this technology – and there are an amazing number of choices – is of no use without the software to gather, communicate, and analyze the new data flows. Without software, there is no IT. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the protocols that communicate data and the emerging data analy...
Sep. 25, 2016 11:00 AM EDT Reads: 1,565