6 Jan

Increase in first-time buyers continues

Increase in first-time buyers continues

The number of first-time buyers in the UK has risen for the third year running, according to new figures.

Halifax's annual First Time Buyer Review shows there was a total of 326,500 people stepping on to the property ladder in 2014 - up from 268,500 in the previous year.

This is the largest 12 month increase since 2007 and is 70 per cent higher than figures recorded in 2008.

It would suggest mortgage affordability has improved significantly, with the proportion of disposable earnings allocated to mortgage payments by a first-time buyer reaching 32 per cent in the third quarter of last year.

Halifax stressed low mortgage rates have played a key role in helping people purchase their first home.

Figures also revealed a drop in the average deposit amount needed by first-time buyers to £29,218 compared to £31,582 in 2013, although it remains 67 per cent higher than in 2007 when it stood at £17,499.

"First-time buyers are vital for a properly functioning housing market. Improving economic conditions and rising employment levels have boosted confidence among those thinking about getting on to the housing ladder for the first time, contributing to the significant increase in the number of first-time buyers in the past two years," said Craig McKinlay, mortgages director at the Halifax.

He added government schemes such as Help to Buy had also helped to improved affordability and ensure more favourable conditions for buyers.

It was also revealed almost six in ten first-time buyer transactions are now above the £125,000 stamp duty threshold. However, nationally only 13 per cent of first time purchases were above £250,000 last year.

Regionally, it was a very different picture with 56 per cent of first-time buyers in London paying more than £250,000.

London also saw the highest average age of a first-time buyer at 32 years old, compared to a national average of 30 years.ADNFCR-1222-ID-801768924-ADNFCR

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