First-time buyers are feeling more optimistic about getting onto the property ladder than they were last year, with changes to stamp duty in April failing to dampen their desire to own a home.
A third (33%) of first-time buyers think now is a good time to buy a property, according to research carried out by the Building Societies Association (BSA), almost double the number a year ago. This compares to only one in five of all UK adults (20%) who believe now is a good time to buy.
Three cuts in the Bank of England base rate have helped boost first-time buyer optimism, although those trying to get onto the property ladder continue to face significant affordability issues, as well as difficulties saving a deposit.
Paul Broadhead, Head of Mortgage and Housing Policy at the Building Societies Association, said: “The Financial Conduct Authority’s mortgage lending review, which we hope will consider the relative costs and benefits of stricter regulation versus the social benefits of home ownership, should help deliver greater mortgage innovation to meet the needs of prospective homebuyers.
“For example, allowing part repayment, part interest only lending, and the flexibility to shift between them, could improve affordability for many and be the difference between be able to get on the property ladder or not.”
Stamp duty changes not deterring buyers
Changes to stamp duty happening in April, which will see first-time buyers pay more tax when they purchase a property, aren’t widely perceived as a barrier to homeownership, the BSA’s research found.
Around one in five (22%) people think that Stamp Duty would be an obstacle when buying a home, but for first-time buyers this figure drops to only 16%.
Most homeowners also aren’t worried about being able to keep up their mortgage payments either. Only 6% said they were concerned about maintaining their mortgage payments over the next six months, down from 12% a year ago (Dec 2023).
First-time buyers can find out everything they need to know about getting onto the property ladder, as well as first-time buyer mortgage options, at our First time buyer mortgages hub.
