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Written by rosalind renshaw

First-time buyers account for less than a quarter of all house purchasers and in many areas on the UK account for a fifth or even fewer.

Rightmove said that at just 22.8%, the proportion of first-time buyers is now around half the level typical of a healthy housing market.

More than half said their biggest concern was getting a mortgage, with 44% saying their main concern was raising a deposit. A further 10% were worried about being able to meet monthly mortgage payments.

The findings were discussed at yesterday's emergency summit, held by housing minister Grant Shapps to discuss the first-time buyer crisis. The meeting heard that there is no 'magic bullet' to solve the problem.

Rightmove questioned nearly 30,000 prospective home buyers last month. Of this number, less than one in four said they were planning to buy for the first time.

But the 22.8% proportion is a national average, boosted by the much higher number (at 38.6%) of prospective first-time buyers in London.

In Wales, the proportion falls to 18.4%, and in the south-west to 18.7%. In Scotland, the proportion of first-time buyers is just 19.9%, in East Anglia it is 19.6%, in the north 20.5% and in the south-east 21.6%.

Rightmove has been tracking first-time buyers’ intentions since the last quarter of 2009, when 27.6% of respondents said they would be purchasing for the first time.

Miles Shipside, director of Rightmove, said: “The level of first-time buyers dropping below one in four of all prospective buyers is a big concern for the property market.

“The desirable level of first-time buyers for a healthy market is typically around 40% of all buyers, almost double the current level, as they perform a vital function in completing chains and aiding fluidity throughout the housing ladder.

“These findings are likely to heighten Government concerns about the scarcity of first-time buyers and it is imperative for the long-term health of the market that a solution to this issue is found.”

Comments

  • icon

    Phil Harris: Welcome to the world where discressional eyesight is the norm - therefore you will be well at home!

    1. " Typical bulls**t artist EA......lol" I took the liberty of restraining your abusive terminology. I'm sure you WILL mind... I will repost the relevant section of my closing words for you to miss again - " I am NOT an Estate Agent, OR a "BTL parasite""
    2. " FTBers said that house prices were £55k in 1997.
    So what if he was rounding that figure up, and it was in fact £55,810?" Firstly, that's called rounding DOWN, not up! Secondly, if you are going to use statistics, then at least be consistent with them otherwise you get shot down. 'FTBers etc...' simply pulled the highest and lowest as they suited him/her/whoever best. In this case, it was the Q1 from one period and the Q4 from the other. In rising markets, these are always going to give the lowest and highest figures, loading the dice in favour the person rolling them.

    3. "FTBer also stated underneath those figures that
    [*Other Sources, I.E. The Halifax, has the AHP rising even higher than £185k*]
    So he's actually chosen a lower figure than the Halifax would have done.... Bit pedantic arent you?" I repeat- if you are going to use statistics and figures, then they must be consistent. the "cost" of a sofa at DFS is £1500 - but they sell it for £500. The fact that the same sofa might be for sale around the corner for more or less does not make DFS change their figures. IF you want to play THAT game, then let's bring in Land Reg figures, which will be comparatively LOWER than both the NW and Halixax indices. Or just stick to the same set of stats, and have a proper debate - your choice.

    Last point. Sweating? Me? Mate - I ain't even breathing hard yet. You tee 'em up - I'll knock your balls clean out of sight every time ;0)

    I ain't pulling ANY wool over ANYONE'S eyes - but I sure can see it when people try to do it to others...

    Remember the old phrase - "Lies... damn lies... and statistics."

    • 18 February 2011 16:56 PM
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    PeeBee

    FTBers said that house prices were £55k in 1997.

    So what if he was rounding that figure up, and it was in fact £55,810?

    [If you sent three estate agents round a house, you would get three different valuations, and the difference would be a hell of a lot greater than £810.]

    So what if FTBer said that 2007 price was £185k?
    When you state its £184k?

    So what?!

    FTBer also stated underneath those figures that

    [*Other Sources, I.E. The Halifax, has the AHP rising even higher than £185k*]

    So he's actually chosen a lower figure than the Halifax would have done....

    Bit pedantic arent you?

    In its most recent house price survey, Halifax said the price of the average UK home was £164,173, while Nationwide puts it at £161,602.

    Yet Both use figures based on mortgage approvals.

    So their is always a small discrepancy, as FTBer has highlighted.

    So Its you who is attempting to pull the wool over peoples eyes.

    Typical bullshit artist EA......lol

    Its you who should be in government.

    Sweating a bit are we? Ho Hum?

    :0) .

    • 18 February 2011 13:46 PM
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    FTBers of the UK UNITED: Ho hum - here I go again...

    Firstly, congratulations on passing your physiotherapy exam. Your manipulation of statistics has performed miracles.

    LIKE THIS - "According to the Nationwide Building Society the Average House price in 1997 was £55k...

    The Average House Price in 2007 was £185k."

    Nice one. the ACTUAL figures read like this: Q1 1997 - £55,810, rising to £61830 Q4. That's an increase of 10.8% over the course of the year. You just happen to pick the lower end - and then reduce it by a further 1.5%...

    Q1 2007 - £175554, rising to £183959 by Q4 - again, an increase over the period, this time of 4.79%. AGAIN, you pick the end that suits your purpose - this time the higher of course, and increase it by over a grand for good measure!

    You should be in Government, pal.

    So - then you draw attention to the fact that sixty percent of the population earn less than the Average wage - SIX MILLION of them under ten grand a year. What is your proposal for THEIR housing requirements? Your fifty or sixty percent drop in houseprices ain't gonna help THEM, is it?

    But, of course, that's okay - YOU'LL be a homeowner by that point, so you'll then be too busy calculating how much the next boom will put on your pad overnight to worry about THEM, won't you...? (Mind you - having seen YOUR statistical capabilities I wouldn't bank on the figures you come up with for a nanosecond!)

    Sorry but when it came to the housing boom, you missed that particular boat. Would you have made as much fuss if the boat you had missed was the Titanic I wonder?

    Life is short. Enjoy it... My parents lived in rented property all their lives, were married for 55 years and brought up a large family who all went on to own their own homes and with the exception of one (that would be me by the way...), all divorced.

    Go protest at fuel prices. The oil companies are the ones wearing masks, not Agents and homeowners.

    (FYI, I am NOT an Estate Agent, OR a "BTL parasite" - NEITHER am I a statistician. There - we share a commonality at last!!)

    • 18 February 2011 11:29 AM
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    @Daniel

    You wrote: "Why have house prices dropped by over 50% [and are still falling?] in many States in the USA, and other countries?"

    You said it yourself ..."in MANY States in the USA" ....house prices have not dropped 50% in EVERY state in the USA ... but they have dropped in the States where there has been a massive amounts of new build.

    The States:
    Massive country with huge amounts of new build in places like Florida and Nevada - leading to low demand for housing in those areas.

    The UK
    Small country with arcane and highly restrictive planning laws, uncontrolled immigration from EU countries - and high levels of immigration in general - with massive demand for housing.

    • 18 February 2011 10:48 AM
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    @FTB'ers of the UK UNITED

    Your averages mean nothing in the real market. If there is one property in a street for sale and it requires (for example) 6 x average salary to buy it - someone earning twice the average salary may buy it with a 3 x salary mortgage.

    The house gets sold and the person earning average wages cannot afford it. So what? Does it stop the market? No. Does it affect the market? Not a jot.

    Your facts and figures mean nothing i am afraid.

    The ONLY way this market will be forced down is if young people - en masse - withdraw from the rental market. In my area a 3 bed semi rents out for over a grand a month. As long as people will pay these rents, prices are going nowhere.

    • 18 February 2011 10:41 AM
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    FTB'ers UK - If you search for any product, I guarantee you it will be far more expensive today than it was in 1997. There is no written rule as to what house prices should or should not be.

    Yes, property is selling in lower volumes and taking a little longer, but while they are still selling, such drastic and fairytale price drops (60%?!!!) will never happen.

    If prices were THAT over-priced - not one person would buy in todays market. WHY are people still buying at all if you're correct?

    Have a read of my earlier post where I gave you the low down of what would happen IF prices miraculously dropped to your desired, fictional, level.

    Nobody has questioned that...yet. FTB's would be blown out of the water.

    • 18 February 2011 09:55 AM
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    History is History. We now live in a modern age.

    Petrol was about 39p a litre in 1991, but were not going to see that drop in price.

    The bitter FTBs out there, who have been waiting for a crash since 2003 you are going to have a long weight, keep lining those landlords pockets.

    Unfortunately some people can't afford to buy a home, thats just life.

    • 18 February 2011 09:18 AM
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    In 1997, according to the Office of National Statistics, the national average wage was £16,666.
    According to the Nationwide Building Society the Average House price in 1997 was £55k.
    £16,666/£55,000 = 3.3x salary.

    By 2007, at the peak of the boom [according to the Office of National Statistics] the national average wage had risen to £23.5k
    The Average House Price in 2007 was £185k.
    £185,000/£23.5k = 7.8x salary

    Conclusion:

    The national average salary in the UK has risen by 41% from 1997 to 2007.

    The average House Price rose by a staggering 236% over the same ten year period. [From £55k to £185k]

    [*Other Sources, I.E. The Halifax, has the AHP rising even higher than £185k*]

    *Interestingly, the average house price rose by only 33.3% from 1987 to 1997. [From £40k to £55k]

    ** The Average FTB mortgage in 1997 was just £41.5k [Council Mortgage Lenders]

    --------------------------------------------------------------------------

    UK Median Household Income 1997 was £13,917.00

    UK Median Household Income 2007 was £19,808.00

    The Median UK Household Income has risen by 42.3% over ten years.

    **Remember Over two thirds of the UK earn less than average wage.

    In 2008 an ONS survey showed that over 6 million people earn £10k per annum or less. These included Hairdressers and Cleaners.

    -----------------------------------------------------------------------------

    Conclusion:

    Even with the increase in two income families
    It is clear that if prices fall to the same level of their long term historic average affordability relative to median household income earnings and interest rates, as they were last, in the mid-1990s, we would be looking at a 50% + fall, from 2007 peak prices.

    End of Conversation. Goodbye.

    [Unless you can explain to me why should UK taxpayers who do not own property, pay to recapitalise Banks, who went bankrupt because of toxic mortgage debt?
    Without this recapitalisation, property prices would have plummeted back to their long term historic average affordability.
    Which again, would mean over 50% falls in average house prices.
    Understand there will soon be more people priced out of housing than those facing neg equity unless a 50% housing crash occurs. The political will to keep house prices massively overinflated is dying]

    Call me when you are prepared to reduce property by 60%.

    Otherwise, as FTB have been saying for years. Forget it.

    [And understand, the quicker this happens the better for the Estate Agency Industry. The only people who will contest this, are the parasites, like BTL, who cannot afford their little empires, if not for low IR]

    • 18 February 2011 08:59 AM
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    Moronic comments as per usual from the EA.

    Why have house prices dropped by over 50% [and are still falling?] in many States in the USA, and other countries?

    And you absolute blind [lying] people think it will not happen in the UK?

    Jeesus wake up!

    Use your BRAINS. Pool your collective brain cells in the office, and [you might just have the capacity to power a very small torch]

    Read and understand the reasons why the BUBBLE inflated.

    • 18 February 2011 08:50 AM
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    Do we always beleive everything that Rightmove say?? NO. i can honestly say we as a business are selling across the board, with correct prices, an excellent whole of market mortgage manager and motivated buyers and sellers.

    • 18 February 2011 07:30 AM
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    The reasons in comments below why prices cannot crash don't hold water.
    We had a crash in the 90s. My house dropped from 125k to 82k and still couldn't sell it ( my job moved to another town). A modern 4 bed detached less than 7 years old. We also had 10% inflation for the 4 years prices took to drop. In real terms that's a drop of over 50%. It's happened before, and it will happen again, regardless of country size, and people staying put if the cannot sell, etc. It also happened in the 70's and after WWII. You cannot have an increase of 300% in 12 years with only a wage increase of 30%. Something has got to break.

    • 17 February 2011 19:21 PM
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    Are houses still selling? I can't figure out why the Britsh are prepared to be fleeced.

    • 17 February 2011 19:09 PM
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    HD, Exactly. They've grown up and witnessed their parents benefit from the boom and think its a given that they are 'entitled to'.

    The sooner that mentatlity is lost, the better.

    • 17 February 2011 16:36 PM
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    AOS - I fully agree with your comments. Where I have a gripe with a lot of FTB's is that they do think they are owed something, they want to be in the best house, in the best area and at the cheapest price possible.

    I agree a home should be a home, unfortunately many have seen the boom of the early Noughties and expect to make a financial gain.

    • 17 February 2011 16:29 PM
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    HG

    Im in no position to comment on Northern Ireland market as I dont focus on it.

    As I said in my post, every homeowner has a choice what they want to do with their home. If you wanted to sell for 40% less its value that is your choice, you would be in the minority though.

    AS AOS, had said in a previous post, if we did wake up tomorrow and everything had dropped 40% we would have a whole new market of bust and boom.

    Prices will probably fall, different percentage wise in different geographical location, I will welcome this if it helps the market move for some people

    • 17 February 2011 16:23 PM
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    HD - You have to accept that prices will rise and fall. When you make the purchase, it should be as a home, not a business investment.

    Of course, it is nice if the value increases, but it can drop - which prices have done in the last few years.

    There are many factors that affect pricing. However, a small section of the market wanting to steal a bargain deal at the fraction of a property's current value is not a factor.

    I see people all the time who show initiative. Ie renting or buying with a partner or friend, lowering their expectations on their purchase or living with family that little bit longer and saving. These are all FTBs who accept that markets are what they are and in the meantime work had to acheive - not sit their thinking they are owed something.

    HG - The mainland is clearly different for the fact that people are still buying and selling houses at current & correct market values.

    You are deluded if you would lower prices while this is the situation.

    • 17 February 2011 16:15 PM
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    @HD

    I'd sell it for what I could get at the time. If I can't sell it for what I want then I'm valuing it wrong.

    Why is the mainland different to NI?

    • 17 February 2011 16:05 PM
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    Well unless people are forced to sell as they can't afford their mortgage, the majority of the public aren't going to sell 40% lower than todays value.

    Everyone has a choice what they want to do, but with interest rates as low as they are, most people are enjoying their reduced rates.

    Let me ask a question, Would you sell your property for half its current value (if you are a homeowner?)

    I understand that all FTB's want a good deal when buying their first home, I sure did as well when i bought my first home, but once you become a homeowner all your perspectives change, you want your home to hold its value or increase.

    • 17 February 2011 15:59 PM
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    IF we woke up in Neverland tomorrow, to 40% reductions - FTB's would NOT GET A LOOK IN.

    A) Only those that HAD to sell, would sell. Therefore, very limited stock in general. The majority of today's stock would be pulled off the market.

    B) The big boys would swoop in to add these few properties to their portfolio.

    C) But more alarmingly for FTBs, you would create a whole new market of property buyers looking to buy second and third properties. These people are not even considering a purchase at this moment in time, but they would do if your disney prices were introduced.

    The addition of new investors to the market, plus the barrell scrapingly cheap supply would lead to a new 'boom' on day one and we'll see prices rise again.

    On a plus, FTB's would have the option to rent the houses they wanted to buy.

    • 17 February 2011 15:50 PM
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    @HD

    Why unlikely?

    • 17 February 2011 15:43 PM
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    TO HG

    Extremely unlikely. But with lots of FTB's here looking for a deal, they may even consider Northern Ireland as a viable move

    • 17 February 2011 14:47 PM
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    @HD

    Or Northern Ireland. Prices here are down about 40% since 06/07. Coming to a town near you soon.

    • 17 February 2011 14:42 PM
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    Why would vendors reduce their prices by 40%, when properties are still selling? Properties priced correctly are selling, over priced properties simply won't.

    If you are looking for 40% reductions or higher, try the States or greece.

    • 17 February 2011 14:16 PM
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    It used to be 'this time is different' but now UK is special.

    I for one have never believed in shortage of property. There are plenty of homes available. In my area many are both for sale or to let, especially flats. If anything, there's shortage of funds.

    Can anyone seriously blame first time buyers not being able to or even prepared to pay inflated prices?

    It's quite simple really. Those who don't have to sell can ask anything they want to and keep their properties on the market for years. But those who actually have to sell for whatever reason will have to lower their asking prices. This is already happening. As simple as that!

    • 17 February 2011 14:14 PM
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    I'm delighted to hear it! It would appear that only half of young people (those without a BOMAD) have decided to ignore the Home-Owner-Ist nonsense telling them to 'get on the property ladder' and have decided that prices are simply far, far too high and are falling again.

    So it's over to you estate agents to persuade your vendors to start dropping prices! About 40% would do me nicely.

    • 17 February 2011 13:55 PM
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    Sounds to me more a gripe about your view of the UK. Blinkers comes to mind and not worthy of further comment.

    • 17 February 2011 09:43 AM
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    @PeeBee

    Like I said, it's shaft or be shafted, everybody is at it. From the banker to the MP to the amateur property investor to the benefit scrounger, everybody wants something for nothing. I can understand your frustration but I didn't design the system. Take it up with the man.

    You can't make parents responsible. The children are generally over 18. Even if you could, the parents would just 'split up' leaving one on a low income and unable to pay for anything. Too many loopholes.

    I hate to be the one to break the news but you're paying for lots of peoples kids to run into the sunset with a free degree and you'll be paying even more once tuition fees rise.

    Have a nice evening.

    • 16 February 2011 17:36 PM
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    "Unfortunately, if they ever existed, honour and principles died a long time ago. It's every man for himself."

    Nah - you're WAAAY wrong there, man!

    I worry more that YOU don't seem to have an issue with what you say is "the youngsters point"!

    Perhaps then we need to make parents ultimately responsible, URGENTLY, in order to avoid your children doing just this - and leaving Daddy sitting smiling about it.

    Why should I and others pay for your kids to run off into the sunset with a free degree?

    • 16 February 2011 17:19 PM
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    :-(

    • 16 February 2011 17:03 PM
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    6. Schooling is poor unless you pay. Just like the UK.

    • 16 February 2011 16:05 PM
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    @wooden top

    Another post full of exageration and incorrect guesswork. I'm not just tallking about Brazil. That is simply where my nephew is going, although I have visited several times. Incidently have you seen the stats these days for Brazilians returning home? As the west stagnates and Brazil booms they are flooding back from all over the world. To address your points in turn:

    1. Crime is high in some areas, not in others. Like the UK.
    2. Ditto death rate and poverty.
    3. You pay for the health care you use. Taxes are much lower so it doesn't matter. I've had some wonderfull cheap dental work over there. You do understand how the NHS is funded don't you? It's not actually free.
    4. It's a warm country so you get a few bugs. No big deal.
    5. Lack of freedom? Say what?

    • 16 February 2011 16:03 PM
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    @wooden top

    Jeez I clearly didn't say every FTB, why exagerate? But a significant number will.

    And you're right, British girls are lovely. If you like big, fat, pasty, heavy drinking ladettes with no ambition other than to get knocked-up and sponge off the taxpayer.

    • 16 February 2011 15:54 PM
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    Oh forgot to mention the crime, death rate, povety, health service, schooling, horrid deadly insects and alike, lack of freedom that you enjoy here and more importantly their whole outlook on life, which is why they come here. I've been there, obviously you haven't.

    • 16 February 2011 15:51 PM
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    @PeeBee

    Unfortunately, if they ever existed, honour and principles died a long time ago. It's every man for himself. From the banker to the MP to the amateur property investor to the benefit scrounger, everybody wants money for no work. I suspect it wont be long before mortgage holders expect the taxpayer to cover their negative equity.

    I can see the youngsters point that why should they, just starting out in life, hang around and pick up the tab for all this? I can't see the SLC chasing people around the globe and if the kids ever get homesick, the debt is written off after 20 odd years.

    • 16 February 2011 15:49 PM
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    For once I have to say DJ what nonsense, what planet are you living on, so every FTB should go abroad. And theres nothing wrong with British girls either, plonker.

    • 16 February 2011 15:47 PM
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    David Jones: "Many also believe that the Student Loans Company wont follow them abroad. Thus saving themselves another 30 grand or so." Sir - if this is true of these people, then the country is better off without them.

    A debt is a debt. Our society is obviously approaching the bottom of a very deep barrel.

    If your words have the degree of truth in them that you suggest, then there is desperate need for radical return to honour and principles.

    • 16 February 2011 15:39 PM
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    @Richard

    No need to appologise, no offence taken.

    Other than me going to Brazil I'm not sure what point you are making, if any. Property may or may not sell in Asian areas and I don't really care either way. I was commenting on the article and the lack of FTB's which is due in part to the clever ones trying their luck abroad. Brazil for my nephew, Germany, Aus, NZ, Canada, SE Asia for others. Many also believe that the Student Loans Company wont follow them abroad. Thus saving themselves another 30 grand or so.

    • 16 February 2011 15:03 PM
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    There is no stagnat market in Asian areas, property sells in all parts of the country. Sorry if you took offence Dave but I can't see any racisim in fact?

    By the way I have some great pictures showing Brazilian birds with few coverings to encourage you to go, post your email and I will send it. Sorry ladies none of blokes, so not too PC am I!?

    • 16 February 2011 14:39 PM
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    @richard

    Probably not as pointless as somebody posting about how pointless it was, with a bit of borderline racism thrown in.

    My point was that potential FTB's with a bit of nouse and a few savings are going to where the future opportunities are. They are weighing up what the UK can offer against everywhere else in the world and the UK is coming up short. Hence there are fewer FTB's.

    You think that the third world immigrants you mention are coming here to buy the cheap property?

    • 16 February 2011 13:54 PM
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    The UK housing market is a pyramid scheme??? Where on earth did you get that idea??? Are you suggesting that a two-bed terrace in the South East of England is worth anything less than 150K!!!

    Come on, get with it. This is a small island with lots of people and not enough houses, like Japan, a country where property prices have managed positive growth for less than three of the last 20 years.

    No, the UK is different, it's special. While house prices rose then fell in places like Spain , the US and Ireland, we wont get the same crash here because UK house prices are built on the fundamentals of our sound economy. We are fortunate to have such great businesses that we can export our way out of any trouble - when was the last time the UK ever imported more than it sold overseas, eh?

    Houses are our economy, that's why it isn't a ponzi scheme. Think how large our construction sector is with the way they are building homes on every bit of land they can find. How many jobs does that support! Think of all those people who move house and then spend money on new furniture in that British company Ikea!

    No, UK houses are not in a pyramid, bubble or ponzi scheme. We're special you see, we're worth it...

    • 16 February 2011 13:46 PM
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    Dave what a pointless post! Unless you missed it, we are being over run with people heading here from third world countries, not the other way round. Why dont you go with him then?

    • 16 February 2011 13:32 PM
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    That's because FTB's are refusing to join the collapsing pyramid scheme and can anybody blame them? Many are actively looking to move abroad instead. My nephew is a case in point. He is 30, well educated and has a £50k deposit. Why would he pay that for a quater of a UK shoe box plus a lifetime of debt? He's decided instead to learn Portuguese and move to Brazil where it'll get him a whole house. The wages are pretty good too and I hear the weather is better........and the women.........and the food...........and the football..........low taxes and no army of benefit scroungers to support. I think that he's making a very sensible choice.

    • 16 February 2011 12:06 PM
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