First-time buyers show their intent

- Wed 10 Apr 2024


Lower mortgage rates seems to be the main reason behind a surge in first time buyer activity as 33% of all sales agreed in the first quarter of 2024 are to first time purchasers. One of the key drivers behind this remarkable increase is the decline in mortgage rates, propelled by falling inflation rates. In fact, lower mortgage rates have proven to be a lifeline for many aspiring homeowners, contributing to first-time buyers representing 33% of all buyers in the market, a notable increase from 23% in 2023.

There is also positive news in the mortgage world as there is now a 99% Loan To Value (LTV) mortgage product available on the market. With a minimum deposit of just £5,000, you can step onto the property ladder and enjoy peace of mind with a 5 year fixed rate. There’s no lender product fee and this is currently available across England, Scotland, and Wales for properties up to £500,000 (excluding flats and new builds). For more information about this option, contact Bradleys Financial Management’s team of experts (details below).

Hamptons' research also suggests that if this momentum continues, the UK could witness a record-breaking 363,000 new homeowners by the end of the year, marking the highest number since 2009.

While the overall trend points towards a surge in first-time buyer activity, certain regions such as Wales and the North East experienced a slight decline in the share of first-time buyer purchases compared to the previous year. However, it's important to note that these regions already offer relatively affordable housing options, mitigating the impact of affordability challenges to some extent.

Evolution of First-Time Buyer Dynamics

Over the past decade, there has been a notable transformation in the dynamics of first-time buyer activity. The proportion of homes bought by first-time buyers has doubled since 2014, reaching 34% in recent years. This increase can be attributed to factors such as high loan-to-value lending and low-interest rates, which has given a greater accessibility to homeownership for many individuals.

However, alongside this surge in first-time buyer activity, there has been a corresponding decline in demand from landlords, partly due to regulatory changes in the buy-to-let market. While this has been beneficial for aspiring homeowners, it has also presented difficulties for renters, highlighting how different parts of the housing market are connected.

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Get in touch with Bradleys Financial Management today on 01395 222391 to discuss your options with our team of experts.