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First-time buyer numbers at seven-year high

First-time buyer numbers at seven-year high

Category: Mortgages

Updated: 22/07/2014
First Published: 21/07/2014

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

First-time buyer numbers hit a seven-year high in the first six months of the year with the economic recovery and the Government's Help to Buy scheme both playing a key role.

According to Halifax, there were an estimated 144,500 first-time buyers in the first half of 2014 - an increase of 25% on the same period last year and also the highest total for the same six-month period since 2007.

It also meant first-time buyers accounted for 46% of the home purchase market over the six months, the highest proportion since 2000, while mortgage affordability also continued to improve.

Indeed, the proportion of disposable earnings devoted to mortgage payments by first-time buyers stood at 31% during the first half of 2014, well down from the peak level of 47% seen during the first six months of 2007.

The report also revealed that the average first-time buyer deposit in the second quarter of the year was £31,129; an increase of 9% compared with the same period a year earlier.

As a proportion of the purchase price, the average deposit has almost doubled from 10% in 2007 to 19% in Q2 2014.

Given the larger deposits that are now being required, it is unsurprising to learn that the average age of a first-time buyer has increased to 30 years old, up from 28 in 2009.

"The resurgence in the number of first-time buyers has been buoyed by improving economic conditions, rising employment levels and government schemes, such as Help to Buy," said Craig McKinlay, Halifax mortgages director.

Even if you don't qualify for the Help to Buy scheme, it has certainly helped to reinvigorate the mortgage market for first-time buyers looking for a high loan-to-value (LTV) mortgage.

Since the launch of the mortgage guarantee element of the scheme last October, the number of mortgages available to borrowers with a small deposit has more than trebled, meaning there's now far more choice if you can afford the repayments but can't necessarily amass a significant deposit.

It could be a great time to get on board, and if you're thinking of taking the plunge, we have all the information you will need.

Check out our guides on Help to Buy to see if you could benefit, or if you've already found that must-have property, make sure you compare first-time mortgage options using our best buy tables or handy mortgage calculator. Either way, you could be one step closer to realising your dream of homeownership.

What Next?

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For more information on Help to Buy, check out our guides to Mortgage Guarantee and Equity Loans

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.