Halifax: First time buyers account for over half of all home loans

Posted on Friday, September 29, 2023

First-time buyers still accounted for over half (53%) of all home loans agreed in the first eight months of this year, a similar proportion as during the same period in 2022 (52%), as activity in the wider housing market slowed.

This is according to the latest Halifax First-Time Buyer Review which also reveals that the number of first-time buyers was down 22% between January and August 2023, compared to same period last year.

Halifax data shows that the average price of first home  is now £288,030 – down just 2% in the past year and first-time buyer deposits have fallen 12%, although still averaging £54,116.

Scotland is the UK’s most affordable place for first-time buyers to get on the property ladder.

Halifax director of Kim Kinnaird, Director, Halifax Mortgages comments: “The average age of those buying their first property is now 32, rising by two years over the past decade, most likely reflecting that increasing costs are making the road to home ownership longer. Also, when people are ready to buy a home, most are doing so in joint names which helps both in terms of costs and affordability.

“The expected further fall in house prices this year – alongside stronger income growth – may somewhat offset higher interest rates, which will be welcome news to many. Further, there are some areas which continue to be great options for first-time buyers – the average cost of a first property in Scotland, as an example, comes in at almost £100,000 less than the UK average.”

Kinnaird adds that while the number of first-time buyers has fallen between January and August of this year compared to the same time last year, a record number got on the ladder over the previous two years as, post-pandemic, buyers took advantage of low interest rates and government help available at the time, including stamp duty relief. This means that the number of people entering the property market for the first time is 17% higher than ten years ago.

“Further, strong income growth in recent months means the house price to income ratio for first-time buyers has fallen from 5.8 in June last year, to 5.1 currently, meaning house prices for those getting on the housing ladder are at their most affordable since June 2020, she says.

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