More first-time buyer applicants via brokers are getting offers

Ryan Bembridge

June 8, 2018

Nine in 10 first-time buyer applications with brokers secured a mortgage offer in the first quarter of 2018, up from seven in 10 in Q1 2016.

The Intermediary Mortgage Lenders Association’s Mortgage Market Tracker also found that over three quarters (76%) of first-time buyer mortgage applications with intermediaries resulted in completion in Q1 2018, up from less than half (48%) in Q1 2016.

Kate Davies, executive director of IMLA, said: “First-time buyers’ struggles have been highly publicised, with affordability stretched by house price inflation and modest income growth.

“Yet rising levels of mortgage enquiries, applications and completions shows that first-time buyers remain interested, able and willing to get a foot on the property ladder, with this customer group performing better than any other in the mortgage market, both in the short-term and on an annual basis.

“As well as competitively priced and widely-available deals, many first-time buyers owe their success to initiatives such as the Help to Buy scheme, LISAs and stamp duty relief. However, this continued focus on first-time buyers has come at the expense of the rest of the market, which is becoming increasingly illiquid.”

In the wider market the number of homemovers have fallen by 42% since 2007, with people only moving once every 19.2 years on average.

Davies added: “The government’s commitment to improving access to the housing ladder has gone some way to increasing our supply of new and affordable homes – for example, nearly half (43%) of new build properties are currently a result of the Help to Buy scheme.

“However, while a significant number of aspiring homeowners have benefitted from these initiatives, many home movers, or ‘steppers’ continue to struggle with hurdles including high house prices relative to earnings, stricter mortgage affordability criteria and a lack of suitable homes.

“Recognition and support from both policy makers and lenders is needed for this group, to improve housing turnover and transaction volumes in the wider market. The government should take this pivotal juncture as an opportunity to reassess where in the market injections of new homes are needed: working with developers, planners and lenders to ensure the whole market is well-served.”

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