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FTBs look overseas to beat crunch - 21 July 2008

While the majority of the property media are proclaiming that the silver lining of the credit crunch is that first time buyers (FTBs) will finally be able once again to get on the housing ladder, research from currency exchange specialists Moneycorp suggests that instability in the property market is pushing them overseas. A survey, conducted by OnePoll on behalf of Moneycorp, has shown that nearly three-quarters of FTB are shelving plans to buy UK property, while 44 per cent are turning their attentions to property abroad instead.

This indicates the appetite of the British buyer remains strong, and that people are still prepared to take on the burden of owning a property in the current market instability, so long as they see the property and the market as representing good value.

The gloomy news for the UK property market continues, with the survey of FTBs showing that a third of those questioned have been refused a mortgage in the past six months. This backs up figures from the Council of Mortgage Lenders (CML), showing that mortgage approvals have dropped by 50 per cent in a year.

Four out of five FTBs think their money will go further overseas than it will in the UK, and they are increasingly looking at a property abroad as a home, rather than as an investment. More than half plan to treat their property overseas as a home, rather than as a capital investment to rent out.

“The fact that so many buyers are prepared to get their first taste of home ownership in a foreign land speaks volumes for the state of today’s domestic market conditions”, said Moneycorp spokesman Marc Morely-Freer.

The survey also showed that Spain and France remain the most popular destinations, with the USA and Australia closely behind. Italy comes in fifth this year, down from third place two years ago.

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