First time buyer mortgages
The number of potential first-time buyers in the UK has hit an all-time high of 5 million according to recent research. Thanks to several years of high prices and unaffordability followed by a year of unavailable mortgages, there’s huge pent-up demand from people who are renting but would prefer to own their own homes.
Historically, young couples used to buy a home soon after they decided they were a permanent item. In most cases, this meant they spent less on mortgage payments than they did on rent so they were better off. At the height of the boom two years ago, this wasn’t true - mortgage repayments were higher than rents, which was one good reason for the boom to end and prices to fall back.
Today, it’s again the case that owning is, for many people, cheaper than renting, and the people who are most motivated to do something about this are young couples with, or about to have, their first child. This is when having your own space you can do what you want with becomes a necessity rather than a luxury.
While mainstream mortgages are still hard to come by, builders with rows of surplus homes have been helping out by getting deals for potential buyers. In many areas, these new homes are being quietly sold at well below initial asking prices with the aid of mortgages lined up by the builders. Some of these deals will probably look like terrific bargains within a few years.
