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7 Out of 10 first-time buyers are being priced out of property market

LATEST NEWS | 26.11.2020

Due to the increased demand on the property market since it opened back up again, coupled with increased economic uncertainty, many lenders have tightened things up when it comes to the deals on offer. Unfortunately, it’s first-time buyers that this is affecting the most it seems. With around seven out of ten borrowers looking to buy their first home being priced out of the property market.

Before the pandemic

Before the pandemic really took hold, the most significant portion of buyers in the property market was actually taken up by those buying for the very first time. In fact, first-time buyers accounted for over 50% of the homes purchased with a mortgage, with over 350,000 people in the UK buying their first home in 2019. The cost of buying a first home in the UK has risen on average, and so too of course has the average deposit required. The average first-time buyer paid a staggering £109,000 deposit in the year to September in London, which is around 23.5% of the average £464,000 cost of a first home in the capital.

Struggle for First-time buyers

Now it’s thought that around £5 billion is being held up in the deposits of first-time buyers in total. And these same first-time buyers have opted to delay purchasing a property until the pandemic is over.  Up until around March, there were still a lot of high loan-to-value mortgages available. However, many lenders started withdrawing the more higher risk loans when the first national lockdown hit. It’s thought that around 62% of buyers who had plans to buy their first property, decided to delay during this time. With many putting off their buying plans until 2021 at the earliest. Research from Trussle has revealed that 7 out of every 10 first-time buyers now feel priced out of the market, despite having met affordability criteria before the pandemic, and despite having saved money for deposits. A large percentage of borrowers are also becoming more confused and concerned by fluctuating mortgage limitations.

TaylorMade can help during these times

Whether you’re a first-time buyer looking to get your first mortgage in place, or you’re approaching the end of your current deal - we have the knowledge and experience to help you during this difficult time in the property market. As a leading mortgage broker in Manchester, we can provide you with a personalised mortgage solution, designed specifically to fit your needs and circumstances. If you’re simply looking for the best mortgage deal to fit your needs, speak to our dedicated and experienced team now, who can search the whole market for you.  We also have an online mortgage calculator which can give you a rough idea of how much you could borrow and what your monthly repayments might be. Get in touch with us today on 0345 305 2540, or info@taylormade-finance.co.uk.
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