It seems like FTBs are losing interest. They make up only 18% of all purchases in November compared to 45% back in May!
Have FTBs given up?
Do banks dislike them now?
Has the government turned their back on them because stamp duty is kicking in now from £125k?
Is home ownership something people used to chase but chase no more?
If renting starts to become the norm then we will see the property market change dramatically. We will find:
- Pension Institutions
- Foreign Governments
- Fund Managers
- The super rich
All chasing the bottom end of the market. Then I have to say we will all need to pack our bags and find something else to invest in. The reason being they can run a property portfolio much better than me and you no matter how great we think we are (!).
Prices will get bid up and the smallest of margins will be acceptable to these organisations. These organisations invest in commercial properties and negative net yields are not uncommon. That is to say they invest and budget to LOSE money for the first few years. If they did this with residential properties then you will see the bottom end properties at least double if not treble in prices in a very short period of time.
It is unlikely this will happen but then again they said it was unlikely that a bank could go bust and we’ve had several of those!
So it will interesting to watch. Will the FTB really give up? I sincerely hope they do not. I like the fact that my properties sit next to Mr Smith and Mrs Bloggs who own their property and look after the neighbourhood the way a tenant could never do. Not to say tenants do not know how to look after a place but it is well known that owners look after things better than people who hire. There are exceptions (which may prove the rule) however this is generally true.
Home ownership is the life blood that runs through this country’s veins and it is important that a healthy balance remains. So come on FTBs get back in the game! Learn More.