First-time buyer
First-time buyer is a term normally associated with the residential property market. Very simply, describes people who are prospective purchasers of their first property, be that a flat or house.
Most, but certainly not all, first-time buyers are young people who have recently started their working life and are keen to get on the housing ladder. This can be a difficult process, given the problems associated with saving for a mortgage deposit, their limited funds and their potentially unestablished credit status. This is particularly so given the housing shortage and long term increase in house prices.
People are generally having to work longer to be able to save for a mortgage deposit. In 1960, the average age of a first-time buyer was 23, and they needed to save for two years to have £595 (around £12,738 today) available for a mortgage deposit.
In 2019, the average first-time buyer will be 30 or older and they will typically have to save for more than five years to have their required average mortgage deposit of £20,622.
Recent years have seen the introduction of various government and private-sector initiatives designed to help first-time buyers get onto the housing ladder. These include:
- Help-to-Buy schemes.
- Equity loans.
- Mortgage guarantees.
- Shared ownership.
- NewBuy.
NB English Housing Survey, Headline Report, 2020-21, published by the Department for Levelling Up, Housing and Communities in 2021, suggests: ‘First time buyers are defined as households that have purchased a property that is their main home in the last three years, and in which neither the HRP or partner have previously owned a property. It includes households who have purchased their property outright as well as those who are buying with the help of a mortgage or loan.’
[edit] Related articles on Designing Buildings
- Buy-to-let mortgage.
- Help to buy.
- Home ownership.
- Housing market.
- Housing shortage.
- National Planning Policy Framework.
- Owner.
- Rent to buy.
- Resident.
- Right to buy
- Right to rent
- Self build.
- Self build initiative.
- Shared equity / Partnership mortgage.
- Shared ownership.
- The rise of multiple property ownership in Britain.
- What is a mortgage?
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