The prices of the housing market are going down. This is a good reason for buyers to invest money in the sector.
Especially young people want to invest. They can do this because their parents lent them large amounts of money, so they can pass the mortgage lending criteria and get a loan.
According several estate agencies, the sales rose about 10% thanks to these young buyers. The ‘first-time buyers’ , with incomes that are not very high, are also able to buy houses. They are even responsible for a big part of the 10% rise.
For instance, there was an increase of 16% of mortgage loans given to people with incomes less than £40,000 between July and October.
The government thinks that first-time buyers are essential for the industry on long-term. In order to help these people, the government came up with a lot of schemes.
Although it may seem easy to get a loan, if you don’t have a good credit history, it is hard to find a good mortgage provider.
I think it is a good thing that the prices start to decrease. Maybe we could expect this, the prices increased with more than 40% in the last 5 years.
The fall is indeed a good thing for the young people. If the prices remained that high, they wouldn’t be able to buy their own house. And I think that everybody dreams of having a house of their own.
The price of a house declines, but the price of building sites will not do the same. Every year, there are less building sites, so the price will rise even more, which makes this situation even more interesting.
Source: The Financial Times - Housing market lures back first-time buyers -
http://www.ft.com/cms/s/0/fb8a52f6-ab2d-11dd-b9e1-000077b07658.html
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I also believe that is a good thing that prices of houses are going down. The prices of housing markets are also volatile like the stock market, it only takes more time. It's good for young people to be able to buy a house, but the problem still stays the price of the building sites like Wouter already said. I don't think that young people will stay able to build a house when the prices of building sites keep rising.
I think prices of houses should keep dropping. When there are lower prices, people will start building an buying houses again. That could give a boost to our economy.
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