CREDIT CRUNCH FORCES FIRST TIME BUYERS ABROAD

- Three quarters (74%) of first time buyers (FTBs) are shelving plans to buy property in the UK due to the current financial climate
- Nearly half (44%) of FTBs plan to buy abroad instead
- Spain and France are the top choices, followed closely by the USA and Australia

Three quarters of FTBs are abandoning their plans to buy property in the UK due to market instability, with nearly half putting their hopes in property abroad.

Moneycorp’s First Time Buyers Report, which examines the FTB market every two years*, also reveals that a third have been refused a mortgage in the last six months. This statistic backs recent figures released by the Council of Mortgage Lenders, highlighting that the number of mortgage loans to FTBs fell to 17,800 in March, down almost 50% from August last year.

As lending criteria tightens and 100% and 95% mortgages disappear from the market, UK first timers are turning to foreign shores to live their investment dream - where more than four in five think their money will go further.

Spain** continues to be the number one choice for FTBs setting their sights overseas, with France in second place. The USA has pushed into a top-five position, with cash savvy Brits looking to take advantage of the weak Dollar. Australia is in fourth place in 2008 – despite not making an appearance in the top five back in 2006 – and Italy is down from third place in 2006 to fifth place this year.

And it seems this increased interest in overseas markets isn’t just fuelling the Buying Abroad Renting in Britain (BARBies) trend. More than half (55%) of those planning to make a purchase overseas will treat the property as a home as opposed to an investment – up from a third (36%) in June 2006.

“The fact that so many buyers are prepared to get their first taste of home ownership in a foreign land speaks volumes for the state of today’s domestic market conditions,” said Moneycorp spokesperson, Marc Morley-Freer.

“Our research also shows that two in five (41%) FTBs aren’t aware that favourable exchange rates can save them a lot of money when transferring funds abroad – for deposits or mortgage payments. Companies like Moneycorp make it easier – and of course cheaper – to buy overseas, as we’re able to provide better exchange rates than a bank. With more currency, first time buyers have a greater choice when it comes to purchasing their property overseas. “

Notes to editors

The research was conducted by OnePoll on behalf of Moneycorp. OnePoll surveyed 500+ first time buyers in May 2008
* The last Moneycorp First Time Buyers Report was issued in June 2006
** Table 1: Findings from Moneycorp’s First Time Buyers report in 2006 and 2008
2008 top 5 most popular countries with FTBs
2006 top 5 most popular countries with FTBs
34% Spain
27% France
22% USA
12% Italy
18% Australia
6% Cyprus
17% Italy
5% Bulgaria


About Moneycorp

Moneycorp is a trading name of TTT Moneycorp Limited, which has been dealing in foreign exchange since 1979 and last year traded over £10 billion in currencies. The Company has been accredited to ISO 9000 Quality Assurance since 1996, a unique achievement in the foreign exchange industry.

Moneycorp’s Commercial Foreign Exchange Division is the UK's leading foreign exchange specialist and provides tailored services to help companies and individuals save money on their overseas currency transfers.

Clients benefit from a Personal Dealer who they can contact directly and who will provide regular updates on exchange rate movements. They also benefit from extended office hours 6 days a week and 24-hour exchange monitoring. A range of services is available, including spot and forward contracts.

The Royal Bank of Scotland (RBS) is a significant shareholder in the Group.