Newcastle Building Society: First time buyers want gardens but fear rising costs will stymie plans

Posted on Tuesday, May 17, 2022

Around 61% of first-time buyers say a garden is top of their wish list when they step on the property ladder, but 51% of these prospective buyers still living with family feared rising living costs would prevent them from getting a mortgage, according to Newcastle Building Society.

The desire for open space “reflects a shift in first-time buyer needs following the pandemic including the move to continue remote or hybrid working,” says the mutual’s inaugural Home Happiness Index 2022.

It adds that natural light, at 31% is more sought-after than good transport links, 26%, while closeness to friends and family, 34%, drives more buying decisions than being in the catchment area of a good school, 22%.

However, 44% of FTBs said they were worried about getting a mortgage. This increased to 56% of those living in the South East where property prices are among the highest. Also, 40% said the rising cost of living was a worry, increasing to 51% of those still living with family.

Electricity and gas bills for a typical household jumped by £693 a year last month, a 54 per cent increase, after regulator Ofgem raised the price caps energy firms are subject to earlier this month, with further rises expected in October.

Inflation hit 7% in April, a 30-year high. The Bank of England has warned that inflation will top 10% by the end of the year, something not seen since 1982.

The mutual’s survey also asked FTBs for their top reasons for buying a home. It found that 48% point to the security of owning their own home, while 43% say that renting is “a waste of money”.

Half of those questioned in the South East said “a priority” was getting a foot on the property ladder, compared to just 30 per cent in the West Midlands.

Newcastle Building Society chief customer officer Stuart Miller says: “It’s perhaps no surprise that after more than two years of dealing with the pandemic, FTBs are prioritising a garden more than anything else – but it is interesting that having a good broadband connection is more important than being close to work.

“The ongoing cost of living rises are clearly top of mind for first-time buyers, especially for those who’ve been living at home and not had to deal with bills. To provide greater certainty around their household budget, we’re seeing more and more people looking to fix mortgage repayments for the long term – up to ten years in some cases.”

Newcastle Building Society’s online poll was carried out by data group Opinion Matters, between 23 February and 1 March, among 1,066 respondents who hope or are planning to buy their first property over the next 18 months.

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