Stagnant house prices could increase purchase leads

House prices in the UK are predicted to remain at their current level for the rest of the year. Could this lead to an increase in purchase leads from first-time buyers?

According to data from Nationwide, UK house prices remained relatively unchanged from the final quarter of 2010 to the same period in 2011, with the average home rising in value by 1.1%.

Robert Gardner, Nationwide's Chief Economist, said that it doesn’t look like the housing market will perform much better in 2012.

Bargains for first-time buyers

Over recent years, first-time buyers with low deposits have struggled to secure mortgages, but this could change in 2012.

With there being an increasing number of high LTV products on the market at the moment and property prices being low, first-time buyers could well pick up a bargain property over the coming months, said Chris Cowdery, Head of Sales at FinanceLeadsOnline.co.uk.

‘We have a good volume of purchase leads at the moment and this could rise even further as first-time buyers look to get on the property ladder while house prices are affordable,’ he added.

A helping hand

Furthermore, there are plenty of government initiatives designed to help first-time buyers who have low deposits.

Back in November, David Cameron announced one scheme designed to help more people in the UK to own their own homes.

The Prime Minister pledged £400 million in taxpayers’ money to kickstart the housing market and help first-time buyers to get on the property ladder.

As part of its Get Britain Building Fund, the government will underwrite mortgages for approximately 100,000 first-time buyers who purchase new-build properties.

In some cases, buyers will only need to save a deposit of 5%, compared with current averages in the region of 20%.

Equity loan scheme

First-time buyers can also get help in purchasing a property through an equity loan.

These are available on certain newly built homes on specific housing developments across England.

The buyer pays for at least 70% of the property and the remaining cost is paid by the government and the house builder through an equity loan.

If the buyer wants to move house, the government and builder will get the same share of the property’s price when it is sold.

Tax exemption

First-time buyers can also benefit from exemption from Stamp Duty.

Those who have never owned a property before and are buying a home worth under £250,000 don’t have to pay Stamp Duty Land Tax on their purchase.

However, this scheme is set to come to an end on 25 March, so first-time buyers need to act quickly to benefit from this scheme.

For updates on lead volumes, follow us on Twitter at twitter.com/FLOleads.