Confidence in the housing market is at a ten year low report the estate agents. Its not so much Hip Hip hooray just more layers of bureaucracy.

HIP’s are compulsory for house with 3 or more bedrooms. But from tomorrow they are required for smaller home as well. Packs typically cost £300 to prepare.

The packs are seen as adding extra layers to the house buying process that isnt welcome. The Royal Institute of Charted Surveyors have reported price falls four months in a row. They also found that only 1 percent of buyers ask to see a HIP .

First time buyers who may want to move up the ladder will now have another cost from tomorrow.

In a recent report from the London Housing Federation, it was estimated that first-time buyer needs to earn more than £100,000 in order to afford an averagely priced house in 25% of all London boroughs.

The average price for a house in the capital has hit £318,000, which is double the national average that first-time buyers can expect to pay anywhere else in the country. Desperate times for first-time buyers have created what is being described as a ‘social crisis’, where increasing numbers of people are struggling to get their foothold on the property ladder.

House prices in London have been steedily increasing since 1997, fuelled by huge City bonuses and foreign investment. In fact the average house price has now increased by 161% of what it was in 1997, whereas income has only increased by 40%. With this in mind, first-time buyers are now saying that they need to earn an income of over £86,000 to buy an ‘averagely’ priced house in the capital, based on traditional lending multiples. The actual average earnings in London are more like £24K, therefore the first-time buyer needs to look at borrowing 13 times their salary in order to buy their own home, which mortgage lenders would never agree to.

The cheapest properties are in Dagenham and Barking, but even then first-time buyers are looking at paying £175,159 to get a foothold on the property ladder. This would mean actually earning an average of £47K or borrowing over 8 times the first-time buyers average earnings, when most mortgage lenders will only advance 4 times.

With predicted figures for property prices looking to increase by at least 5% next year, the buy-to-let market is set to go crazy with more people than ever wanting to rent.

The buy-to-let market rose by 10% this year alone according to the Royal Institute of Chartered Surveyors and the rise is set to continue. Demand is strong and investors are able to secure some excellent deals, making this the age of the buy-to-let.

The rise in 100% mortgage borrowing has lead to buy-to-let properties accounting for 11 per cent of the total mortgage market in 2006.

The housing market has come a long way since the Council of Mortgage Lenders recorded its first ever figures in 1999. There are several factors that have lead to the market boom that we are now experiencing, but none so powerful than possibilities that people see within the housing market for investment return and the thousands of people looking to rent from them.

Back in 1999 there were just 73,200 mortgages worth £5.4 billion and now figures are around the £100 billion mark and there are 849,900 buy-to-let mortgages.

It is clear that consumers see property and buy-to-lets in particular as an obvious place to invest money for retirement or as an actual income and the demand for properties to rent will continue to grow. With growth in student property to accommodate the number of university goers, affordability issues for first-time buyers, the break-up of the family unit and mass immigration there has been a huge change in attitudes towards renting and will see the buy-to-let market’s biggest figures in 2008.

The Royal Institution of Charted Surveyors have reported a fall in house prices. According to the RIC, house prices fell in September and more of their members reported a fall locally than an increase.

It was also reported that there was a fall in first-time buyers for the 10th month in a row. The combination of higher interest rates and tightening on lending criteria are two major factors that have contributed to the downward spiral in first-time buyers being able to afford the jump from renting to home owner.

It is seemed unlikely that whilst economic growth and income is above the average, that we will experience a change in the housing market.

It is a daunting time that certainly is affecting the confidence of first-time buyers and sellers for that matter. The Council of Mortgage Lenders feels that the sheer burden of repaying the interest on mortgages for first-time buyers is the worst in 16 years, with a similar problem affecting people moving house. The CML foresees that this will only get worse in the forthcoming months.

Lenders have to cover the cost for the risk they are taking on and so mortgages are only going to become more and more expensive for customers who have poorer credit histories.

First-time buyers can now expect to pay £176,070, which is an increase of 11.9% since last August, and many are stretching themselves to breaking point in order to get a foot on the housing ladder.

This means that first-time buyers are making themselves vulnerable despite the increase in income and the sharp increase in the proportion of new mortgages with high loan and multiple incomes, isn’t helping.

On average it is estimated that parents are shelling out £21,314 to help their children to get on the property ladder, with around 20% having already dipped into their savings and a further 22% planning to when the time presents itself. IFAs are reporting that the new average age for first-time buyers is 34.

Lack of affordable housing for single first-time buyers has forced people into multiple income mortgages and has resulted in the rate of borrowing increasing to 3.38 times the combined salary.

With the average house price in England currently sitting at £ 226,902 and the average house price inflation rising by around 11.4%, what are first-time buyers hopes of ever getting a foot on the rung of the property ladder?