Halifax reports record number of first-time buyers

by | Tuesday 25th Jan 2022 | Mortgage News

2021 was the most first-time buyer saturated year in at least 10 years according to Halifax intermediaries coming off the back of a year of pandemic uncertainty. The usual reported narrative around first-time buyers in the news depicts a rather bleak outlook on first home ownership with rising property prices and deposit requirements deterring or hindering people from making the leap on to the property ladder however, despite these very real factors, Halifax have reported some very surprising and encouraging figures.

Halifax’s take on first-time buyers

Halifax has released a statement of their findings from their annual survey which shows that 409,370 first-time buyers bought a home last year, rising by a record 35% compared to 2020. These buyers accounted for 48% of the overall property market which is an incredible market share. It seems that a rise in house prices has not overly affected purchasing potential however the average age of a first -time buyer but deposits fell.

The average FTB last year was 32 years old compared to 29 ten years ago which is not a huge difference but is over 30 in every UK region and they put down on average a £53,935 deposit on a property costing £264,140, which is a 3% rise on asking prices in 2020. Halifax states that as more buyers entered the market in 2021, the average first-time buyer deposit fell 6% across the UK to £53,935, with only Wales (where it rose 4% to £33,622) and Scotland (where it also rose 4% to £37,038) noting an increase regionally.

But, despite seemingly being a positive figure, Halifax reports that this fall in the UK average was set against a rise in the average purchase price of first homes, which meant that, overall, the gap between purchase price and deposit widened in every region meaning larger mortgages and higher earning needed across the board.

Halifax mortgage director Esther Dijkstra says: “There were a number of factors influencing home-buying decisions in 2021. While working from home and the ‘race for space’ was key for many, particularly movers, it’s clear that the stamp duty holiday increased the availability of first-rung homes as others moved up the ladder. Lifestyles have changed, over time more people have chosen to go on to higher education, go travelling, or move around for work, which are all factors in the increase in first-time buyer age. However, undoubtedly, the biggest drivers are the cost of homes and the need to save a significant deposit to get on the housing ladder. In 2021, the increase in average house price to £264,140, combined with difficulties in raising a deposit, meant that the gap between purchase price and deposit widened in every region in the UK.”

What the mortgage brokers say

So, will 2022 follow in the same trends as 2021 for first-time buyers? Louis Mason, content manager for Oportfolio says: “Oportfolio have always been extremely supportive of first-time buyers. We want to see everyone who works hard and strives to buy their first home achieve their goals. In recent years we have seen it become more and more difficult for new buyers to both find a property in their budget and then get the mortgage lending that they need but there are options and people shouldn’t be put off. Everyday we speak to nervous people who have almost completely written off the idea of owning a home and they are always pleasantly surprised after having a chat with our advisors at what they can actually afford. As well looking at a straight mortgage, first-time buyers could also explore things like shared ownership and help to buy as alternative methods of buying. I would always highly recommend talking to us before you do anything else so that we can give you some help and guidance on where to start.”

If you or anyone you know is looking to buy their first home, then read our First-Time Home Buyer Questions To Ask A Mortgage Broker or contact our Putney mortgage team today to see how we can help you make your dream of home ownership a reality.

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