First-time buyers face granlord struggle

Estate agents and financial planners are seeing an influx of retirees or soon to be retirees enquiring about buy-to-let opportunities on property that would normally be suitable for first-time buyers – a factor that could drive prices through the roof.

And earlier this month Scottish Friendly claimed that first-time buyers had just 30 days to get on the property ladder before prices hiked.

Lovatt said: “This is going to make things even tougher for first-time buyers.

“In particular it will affect people in rural communities and possibly even in attractive seaside communities where houses are already in short supply

“Young people also have student loans to pay off - it’s a difficult world. ”

Rightmove’s House Price Index has also revealed that estate agents are seeing more interest from ‘granlords’.

David Blythman, managing director of agent Scottfraser in Oxfordshire, said: “Our investment search division are now receiving a significant uplift in enquiries including many from granlords - first time, retirement age, buy-to-let investors diversifying their pension investments.”

And Ken Hume of James Alexander in Norbury, South West London, added: “We’ve had enquiries from a number of older people considering buy-to-let which is likely to have an effect this year, with interest expressed particularly in smaller flats where yields are higher.

“As this end of the market is not as busy in our local area, these buyers are a welcome addition, especially as they are often 100% cash.”

Lovatt thinks young buyers in the South have already been left in the lurch.

He said: “If you live in London and the South East for young people trying to save up for a deposit it’s going to take up 40 years – in the North it’s only 10 years.”

Ying Tan, managing director of the Buy to Let Club, said first-time buyers only have a “finite number of properties” to choose from but doubted whether pension reforms would send the buy-to-let market into overdrive.

And others have their doubts too.

Cammy Amaira, head of intermediary sales at National Counties Building Society, said: “There’s a big question mark as to how many are going to do that.

“I’m not convinced there will be as many people as some might think.”

Property expert Kate Faulkner said that in her experience no good buy-to-let investor would ever compete with first-time buyers on price.

She added: “One the one hand buy-to-let investors do go for similar stocks for first-time buyers but on the other hand they will be outpriced.

“It’s a stupid buy-to-let investor that competes with a first-time buyer for the property.”