Two-thirds of first time buyers pessimistic about finding a home
Over two-thirds of people who want to buy their first home within the next two years are pessimistic about this happening. Some of this group are also frustrated about competing against homeowners who can use their equity when buying, the Telegraaf reports based on an ING study among 1,261 homeowners and first-time buyers who plan on buying a home in the next two years.
Over a third of homeowners estimate their equity - the value of their home minus what they still owe on their mortgage - to be between 50,000 and 150,000 euros. Almost half think they have even more.
“It is striking that home prices have risen so quickly that a large proportion [40 percent] of homeowners would no longer be able to afford their home if they had full financing,” ING researcher Wim Flikweert said to the newspaper.
The ever-increasing equity gives existing homeowners a stronger position when buying a home - they have more of their own money to bid. The situation frustrates 25 percent of first-time buyers and 40 percent are jealous about homeowners’ equity, ING found. More than half expect this gap to grow in the coming five to ten years.
People just entering the owner-occupied housing market already have a hard time finding affordable housing. The average transaction price was €467,355 in October, according to Statistics Netherlands.
ING found that 68 percent of first-time buyers don’t have the budget to afford a home, or can’t find anything within their current budget. Almost half of first-time buyers who are currently renting say they are struggling to save anything due to their high rent.
92 percent of homeowners are happy with their equity or think that they have earned it by buying a house at the right time. The equity has grown due to home prices increasing and homeowners paying their mortgages.
