Despite a rise in property prices (in November 2009, house prices raised by 1.7%), the situation on the UK property market remains favourable to buyers.

In 2007, only 6% of all council areas in the UK provided property that was affordable to the average earner. In 2009, this same figure rose to 39%. What's more, the Bank of England confirmed that the housing market was favourable to buyers by anouncing that the total net lendings to individuals raised by £1.1 billion between November 2008 and November 2009. These figures show that the housing market has become more favourable to buyers and to first time buyers in particular.

A First time buyer is a buyer who has not previously owned a property. Sellors often favour this type of buyer, as there is less of a risk of creating a housing chain. A housing chain occurs when the sale of a property is reliant upon the sale of another property. However, first time buyers can be the starting point of a housing chain.

People who have never previously owned property can also take advantage of mortgages that have been specialy made for them. These mortgages are made to make it easier for people who have never previously owned a property to get a foot onto the property ladder. The lender will sometimes waive the payments or pay off the administrative fees.

However, many of the first time buyer mortgages that are offered by banks and building society are shared ownership mortgages. First time buyers favour this type of mortgage because they only need to pay a fraction of the deposit required to purchase the property, but this also means they only buy a fraction of the property. The main type of first time buyer mortgage that is available is shared equity mortgages.

Shared Equity Mortgages are mortgages whereby the borrower only pays a percentage of the full open market price of the property, but acquires 100% of the property, and the balance of the purchase monies are by an equity-sharing lender (often the sellor).

Mortgages for people who have never previously owned property are designed to help buyers who have never previously owned a property step into the housing market. That why this type of mortgage often includes a shared equity clause or a shared ownership. Thus making it cheaper for first time buyers to take out a mortgage.

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