Over half of first-time buyers who bought a home last year couldn’t have done it without family support, new data shows. Barclays Mortgages’ First-Time Buyer Index revealed that between 2020 and 2021, the number of first-time buyers doubled.
Unfortunately, though, 56% depended on help from their family when it came to raising a deposit and climbing onto the ladder.
56% of first-time buyers depend on family support
‘It’s encouraging to see that first-time buyers have been able to get onto the property ladder in increasing numbers since the start of the pandemic,’ says Claire Macphail, Mortgage Expert at Barclays. ‘However, despite numbers nearly doubling across the last year, it’s worrying to hear that many still believe that they’ll never be able to afford their first property.’
Claire says the Barclays First Time Buyer Index points to the importance of first-time buyers being supported by family. This means it’s essential for lenders to innovate to provide new ways to help give first-time buyers a head start, she says.
‘Barclays, for example, offers different mortgage options for first-time buyers, including the Family Springboard mortgage. This allows family or friends to provide 10% of your property price as security, which they’ll then have returned with interest.’
House prices are continuing to rise, and increased bills due to the UK energy crisis represent an additional obstacle for first-time buyers. Unsurprisingly, given the cost of living crisis and the fact rents tend to be higher than the equivalent mortgage payment, saving for a deposit was cited as the single biggest obstacle to homeownership.
As Claire mentions, Barclays’ report showed that a lot of people feel homeownership is simply out of their reach. A total of 64% of first-time buyers worry they will never make it onto the property ladder.
The well-known bank also highlights a significant knowledge barrier. So it’s important to arm yourself with as much knowledge as possible on the process of buying a house.
Barclays said over half of budding or existing first-time buyers confess they don’t know how to go about the process of buying their first property. 39% said they didn’t know they would need to factor in solicitors’ fees.
Over half were unaware that they might need to pay stamp duty, if not otherwise exempt. For more information, head to the Barclays Mortgages website or speak to a mortgage broker.
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