First-timers account for third of house purchases

FIRST-TIME buyers have been behind around a third (33%) of home purchases across Britain so far this year, estimates suggest.

This is up from 29% in 2023, property firm Hamptons said.

Hamptons took the findings from analysis of data from estate agency network Countrywide, which it is part of.

There were also signs of first-time buyers increasingly favouring smaller homes as elevated mortgage rates stretch their budgets.

For the first time since 2011, over half (51%) of first-time buyers purchased a home with one or two bedrooms.

In 2023, 49% bought two-bed homes or smaller, while the majority of new homeowners bought a larger home.

Mortgage rates jumped amid Bank of England base rate hikes. The recent easing back in inflation has boosted expectations around a rate cut.

Aneisha Beveridge, head of research at Hamptons, said: “The pickup in first-time buyers this year is in part, making up for the lost moves in 2023.”

Last week, Yorkshire Building Society launched a £5,000 deposit mortgage for first-time buyers to buy homes worth up to £500,000.

The Society suggested the mortgage could help to encourage a level playing field for those who do not have financial support from their family.

Yorkshire Building Society’s previous research indicated that around two-fifths (38%) of first-time buyers receive financial help from friends and family to help them onto the housing ladder.

Meanwhile, it was revealed house sellers are typically shaving £10,000 off their original asking price to achieve a sale, according to a property website.

Across the UK, the average discount of 3.9% recorded in March is a “marked improvement” compared with an average discount of £14,250 or 4.5% recorded in November 2023, Zoopla said.

Its report said the narrowing “reflects a combination of greater realism from sellers on their asking price and growing buyer confidence”.

Discounts typically remain bigger in London and the South East, where there is an average discount to the asking price of 4.3% or £19,500, Zoopla said.

The average discount was calculated based on all house sales recorded by Zoopla, including those where there was no discount.

Housing market activity, including sales and the supply of properties for buyers to choose from, has improved in the first quarter of this year.

Zoopla said around 7% more home sales have been agreed over the first quarter of 2024 compared with the same period last year.