For the first time since 1995, first-time buyers make up 51% of the UK mortgage market. As a result, the number of first-time owners has risen dramatically from 72,180 in the first half of 2009 to 170,060 in the first half of 2019 with the average age of the buyer rising from 30 to 31 years of age.
Ladders
These buyers didn’t necessarily get the house they wanted in the neighbourhood they wanted, but are philosophical about their compromises. A third (35%) of those who want to buy said they would give up living in their preferred neighbourhood to purchase a house, 38% said that they would purchase a smaller property, and 27% admitted that their house was unlikely to be their ideal home.
Saving up for a deposit was a big challenge for 64%. The average deposit for first-time homebuyers is now £41,099 or 18% of the average house price. Ten years ago, the average house was cheaper at £138,413 and while the average deposit was higher at 20%, it was still only £27,059.
As Russell Galley, Managing Director of Halifax, said about this YouGov poll of first-time buyers, ‘This shows that with the right support and a few sacrifices, home ownership can remain an attainable goal.’
Snakes
The positive news has to be weighed against some hard realities — two in five (43%) Brits who rent or live at home do not expect to ever own their property, and of those renting, 29% think it’s now normal for people to rent for life.
For those who think that they will buy at some point, affording a mortgage is a significant barrier for 66%, while 64% find saving for a deposit a tough challenge. A third of this same group (35%) plan to use the Help to Buy scheme to get their first home while 6% plan to buy through shared ownership. Almost half (45%) plan to buy with the help of their partner, while 28% expect their family to help out and 23% expect access to an inheritance to help buy.
More than a third of parents seem to accept this reality of helping their children with 35% agreeing to help pay for the cost of a home. However, 25% believe that their children will never own their own home.
Maximise your chances of building a deposit with our calculators. Find the right investment platform here, or the right robo here.
Photo by Patrick Perkins on Unsplash
