An interesting thing appears to have taken place during the long recession in the property market.
The average age of first time buyers increased.
Back in the boom years, in 2005 and 2006 and even into 2007, the average age of first time buyers hovered at 29 years old. In the latest mortgage statistics released by Bank of Ireland, the average age is 32.
It is perhaps little wonder that the average age has risen. When the credit crunch peaked in late 2008, it brought with it a collapse in employment and a rise in unemployment. Those under 25 were the most affected…many either lost jobs or never got one to begin with. The years of saving for a first home simply never really happened. Some hung on but many left for a life elsewhere. Those that remained and purchased concentrated around an older age profile.
Other factors also played a role in the greying of the first time profile. Everybody took on a wait-and-see approach to property prices, avoiding purchasing, not wanting to be caught with a home that decreased in value. Lenders also played a major part, demanded more and more evidence of job security…and that deposits were saved personally. It all required time.
The return to lending by the country’s largest lenders can only be a positive for the overall economy, not just the property market. In addition to Bank of Ireland, statistics showing an increase in mortgage approvals in November from the Irish Banking Federation, a slow return of stability in house prices from the Central Statistics Office and a promise of a five-fold increase in lending by Permanent TSB all point to a more positive housing environment in 2013.
What is needed now is some positive news on the jobs front.
It’s has been a long, slow and difficult journey, but it is difficult to dispute the ingredients for a sustainable recovery are becoming more and more evident. Now, perhaps what we need is a lot of belief…and a little more luck.