1st March 2011
The Guardian reported Robert Gardner, chief economist at mortgage lender Nationwide saying that first-time buyer numbers were still too low. He said prices were still too high for the average buyer to get on the first rung of the property ladder.
According to Nationwide's latest house price index prices increased 0.3% in February and were 0.1% lower than the same time last year.
Gardner says: "With the supply of housing fixed in the short term, the flow of new buyers into the market has a major impact on prices and activity."
"The fact that first-time buyer numbers are well below the levels prevailing before the financial crisis casts a shadow over the outlook for the wider market."
It would take a worker on average earnings saving 15% of take-home pay eight years to build up a sufficient deposit to buy the average house, which costs £161,183, according to Nationwide's statistics.
On the Guardian JLMBG welcomed Gardner's comments.
"An admission from someone in the housing market that house prices are actually too high … Whatever next?! Could this really be the start of some industry-wide acknowledgment that they're peddling over-priced wares?"
DundeeSkeptic said: "Does anybody actually believe a Nationwide report about house prices going up? Could they possibly be trying to generate a more positive perception of buying houses?