Majority of first-time buyers plan to purchase this year
TWO-thirds of prospective first-time buyers feel now is a good time to purchase a home, despite fears about losing their jobs, new research shows.
About three in 10 are actively looking for their first home, while six in 10 say that they will be actively looking to buy before the end of the year, according to the research commissioned by EBS Building Society.
Mortgage experts said many potential buyers are fearful that interest rates will rise if they do not buy soon. If this happens it could cancel out the benefit of possible further falls in prices.
House prices have fallen about 30pc since the height of the property boom in early 2007, with many economists predicting that they have further to go.
But the move by Permanent TSB to increase its standard variable rates for the second time last month, and warnings from AIB that it will hike its mortgage rates before the summer, have sparked fears of dearer home loans.
The research also shows that potential buyers are shopping around for their mortgage, while the average amount that they expect to spend on their new home is €260,000.
The EBS said that 53pc of respondents report that they were concerned about their own job security, while 22pc said they were worried about that of their partner.
Also evidenced from the survey is that 29pc of respondents stated that they were looking for a bigger house than they had originally planned for, the EBS said.
More than a third of prospective buyers stated that they were now looking in an area that previously would have been too expensive for them.
Kevin McNerney, director of the Mortgage Finance Company, said interest rates were at historically low levels but were not expected to stay there.
"Mortgage interest rates, which directly impact affordability for new buyers, have reduced significantly in the past 12 months.
"The only question that someone should have is whether they are secure in their current employment.
"If they are then they should seriously consider taking advantage of the significantly reduced prices and historically low interest rates," Mr McNerney said.
Last week the European Central Bank (ECB) held its key interest rate at 1pc, but economists warned that mortgage rates for many existing customers would go up anyway.
ECB governors could now wait until the end of this year or early next year before they push up the eurozone rate, economist Alan McQuaid said.
But he warned that once European rates start to rise they will eventually reach 4pc over the next two to three years.