First-time buyer shortage a concern, says Nationwide
A lack of first-time house buyers in the UK is a "cause for concern", the Nationwide Building Society has said.
Its comments came as it said house prices in January were unchanged from a year earlier, although they had risen by 0.5% compared with the month before.
It said that there were 20,000 first-time buyers a month now compared with 32,000 before the financial crisis.
Housing charity Shelter said that rising rents were preventing people from saving to buy their own property.
Shelter called on the government to do more to dismantle what it is calling the "rent trap".
"Rising rents are leaving people with little or nothing to save at the end of each month, giving them little chance of ever saving enough to climb on to the property ladder," said the charity's chief executive, Campbell Robb.
Signs of improvement
The Nationwide said that first-time buyers were the "lifeblood" of the housing market, accounting for 40% of transactions.
However, credit was less readily available than it had been before the financial crisis, especially for those unable to offer a large deposit.
It highlighted the fact that the average buyer getting on the ladder for the first time needed to find a deposit of 20% of a home's value, compared with 10% before the crisis.
The average home was now valued at £162,245, it said, from figures based on its own mortgage data. This was unchanged compared with January 2012.
Nationwide chief economist Robert Gardner said that there were some signs that conditions were improving for first-time buyers, but this depended on a bigger economic picture.
"The most decisive factor in achieving a sustained increase in first-time buyer numbers is likely to be the performance of the wider economy - especially the labour market," he said.
"We, along with most forecasters, expect the UK economy to pick up the pace in the quarters ahead, though progress is likely to be gradual."
Mark Harris, of mortgage broker SPF Private Clients, said: "The vast majority of regions saw price falls throughout 2012. London continues to buck the trend, with heightened competition in parts of the capital, particularly prime central London.
"Transactions continue to be well down on the height of the market, contributing to significant price discrepancies in some areas.
"On the lending front, the picture continues to improve, with some of the cheapest mortgages ever seen," he added.
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