[1] What is good news for one person can be bad news for another. When it comes to property ownership in this country over the past decade, first-time buyers have repeatedly drawn the short straw (bad news). The housing boom that has had millions of older homeowners (good news) jumping all the way to the bank, has been nothing but bad news for first-time buyers.

Latest report received by [2] Less2sell Estate Agent indicates that first-time buyers now need to save £25,600 (up £12,351 from 2001) to cover the costs of buying a home (deposit). And to consolidate the problem, some are borrowing more than six times their income in a desperate bid to get a foot onto the property ladder.

The good news is that the ramifications of five interest rate hikes, the US sub-prime mortgage crisis and the much-lamented global credit crunch start to hit home, there are signs that the housing market is cooling down.

What does this mean for first-time buyers? Well for a change the recent news from the housing market is potentially good news for first-time buyers.

Here are five reasons why first-time buyers should be celebrating:

• 1) Lower interest rates. Before all the banks got their greedy fingers burnt by bad debt the future looked bleak for first-time buyers. The base rate was widely expected to rise 0.25% by the end of the year. Now, the base rate is believed to have hit the peak of its current cycle and some predict it may even fall to 5.5% or lower in the next six months. This means fixed rates are coming down, and is great news for first-time buyers on tight budgets, who need the security that the set monthly payments of a fixed rate mortgage provide.
• 2) Greater supply of property. Buy to let investors have been profiting from the plight of first-time buyers, purchasing what was typically a ‘first-time buyers’ property at prices first-time buyers cannot afford, only to turn around and rent them out to first-time buyers. A recent report received by shows that sales of buy to let properties have risen by 44% this year to their highest level for two years, which means there should be more ‘first homes’ available to buy.
• 3) Less competition. Some mortgage lenders are tightening their buy to let mortgage criteria, reducing the amount investors can borrow from 90% of the property value to just 80%. That means landlords have to put down a bigger deposit, and cannot ‘gear up’ (borrow to buy another property) as easily. Speculative buyers are also most likely to be put off by the fear of a housing market crash.
• 4) Lower prices (possibly!). If and it is a big IF, house prices start to fall, I’m pretty sure that many buy-to-let investors may be keener than usual to sell up, and quick. Whether this leads to a fall in current prices or simply means that the pace of price rises will slow down, will depend to a large extent on the strength of demand and supply in your local area. However, as a general rule, I’d say first-time buyers have a greater potential to wield their power as chainless buyers this year.
• 5) More bargains. The increase in interest rates has already led to a record rise in repossessions by mortgage lenders, with RICS predicting there will be 124 repossessions a day in 2008. So you may be able to snap up a property at a cheap price, particularly if you buy at auction, where mortgage lenders tend to try to offload their repossessed homes.

First-time buyers should not get carried away though! Remember lenders are tightening their requirements and Less2sell advice that you have a healthy deposit to get the best deals (at least 10%).

If you would like free independent mortgage advice please[3] [4] click here.