First-time buyer count reaches 10-year high in 2016

The number of first-time buyers who got on the UK property ladder reached a 10-year high of 335,750 in 2016, Halifax’s first-time buyer review has revealed.

This represents a 7.3% increase from 2015 and is the highest number since the start of the housing crisis in 2007 (359,900).

Martin Ellis, housing economist at Halifax, said: “The number of buyers getting on the housing ladder exceeded 300,000 for the third year in succession – a welcome boost for current homeowners, house builders and the government.

“Continuing low mortgage rates, high levels of employment have supported the market and government schemes such as Help to Buy have improved affordability, enabling more first-time buyers to buy their own property.”

First-time buyer purchases made up almost half (49%) of the market last year, up from 46% the year before and 36% in 2006.

The average first-time buyer deposit has more than doubled (113%) over the past decade from £15,168 in 2006 to £32,321 in 2016.

However in London they increased by a significant 276% from £26,701 a decade ago to £100,445 in 2016.

Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: “The Halifax’s findings are good news in terms of the increase in number of first-time buyers but are also indicative as to what parents and grandparents put themselves through so that they can afford those deposits – with more than £100,000 required in London.

“If the housing market is going to function properly, as the government has told us so many times it should, then we need to protect first-time buyers.

“First-time buyers are the life blood of the market as they tend to buy at the bottom and trade up whereas investors buy at one level and stay there.

“Although lenders are supposed to be providing support via Help to Buy now that the mortgage guarantee element has been withdrawn, on the ground we are finding it is not happening in all cases and more flexibility on lending criteria at higher loan-to-values is required.”

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Written by: Houseladder