No hope for sellers as first-time buyers priced out of market
Those looking to sell up and move to a larger property have been left with little option but to improve their current property rather than move as ridiculously-priced mortgages are scaring off first-time buyers.
Some prospective first-time buyers are being asked to pay as much as seven times the base rate of interest as well as a huge deposit to secure their first property, according to newly-released figures from MoneyFacts.
Analyst Michelle Slade explained that buyers are being scared off even bargain properties by excessively high deposit requirements.
The risk of customers buying a property and falling straight into negative equity is much higher than a year and a half ago," she said.
"Even as much as a year ago, asking a first time buyer to commit to a 40 per cent deposit was virtually unheard of. Now its more the norm."
The result is that house prices are likely to continue to fall due to a lack of activity in the market, forcing those who need more room to achieve it by adding a roof light and converting the loft or building a conservatory.
Nationwide recently predicted that house prices would fall to levels not seen since 2004.