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First-time buyers settle for second-best

First-time buyers settle for second-best

Category: Mortgages

Updated: 31/07/2015
First Published: 31/07/2015

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 It is now over 6 months old so the content may be out of date.

Buying a first home will be a dream come true for just about everyone, but it seems that many prospective buyers are willing to make significant sacrifices in order to make that dream a reality.

Compromising on quality

According to the latest First Time Buyer Opinion Barometer from Your Move and Reeds Rains, a large proportion of homebuyers would be willing to compromise on the quality of their first home – and in some cases, those compromises can be significant.

For example, 20% of first-time buyers (FTBs) said that they were prepared to go without electricity, while 19% were willing to put up with no working plumbing or central heating – all essential features, yet things many buyers would sacrifice (and presumably pay to install later) for the sake of getting on the ladder.

Furthermore, the proportion of buyers willing to compromise increases dramatically when it comes to less essential household features. Dated décor would be an acceptable setback for 77% of buyers, while 76% would put up with a sub-par kitchen and 71% said the same about an out-of-date bathroom. A further 12% would be willing to accept a property with dry rot and 14% said the same about a leaking roof, and in fact, only 9% of respondents claimed that they'd be unwilling to make any significant compromise when buying their first home.

It certainly looks as though first-time buyers would be willing to spend the time and money to make the necessary changes to their property, as 45% conceded that they'd accept a property of any condition that was within their budget, despite the fact that only 15% of respondents were actively seeking a home renovation project.

A faraway dream?

Unfortunately, despite being willing to compromise on quality – and making serious cutbacks to be able to save up for that all-important first home – it seems that home ownership is becoming increasingly out of reach.

The survey revealed that the proportion of tenants expecting to buy by the end of the year has halved compared with a year ago, with only 8% expecting that they'll be able to do so – down from the 16% who said, in June 2014, that they expected to buy before the end of 2014. Nonetheless, it's still a key goal for the vast majority of people, with 91% of tenants aspiring to become homeowners at some point in their lives.

"As demand in the property market remains strong, first-time buyers are willing to accept a home in less-than-perfect condition," said Adrian Gill, director of estate agents Your Move and Reeds Rains, "and most haven't given up on the dream of property-ownership.

"Instead, they are sensibly adjusting their expectations and preparing themselves for some of the shortcomings that may be present in a first home. Indeed, it may even be the case that some first-time buyers actively select properties with faded décor or faulty kitchens, judging that the reduction they can secure on the asking price is greater than the cost of any required renovation work."

If you're willing to make a few compromises and put the time and effort in to make your first home a true dream come true, there's every chance that you'll be able to find somewhere that meets the typical FTB budget. Of course, you'll still need to save sufficiently – read our guide on how to save up for that all-important deposit – and then it all comes down to finding a first-time buyer mortgage to keep your repayments in check, and from there, the world (or your new home) is your oyster!

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.