First Time Buyers

New data indicates that first-time buyers (FTBs) are taking out longer mortgages to help them move straight into their ‘forever home’.

In August, a third (33.5%) of FTBs bought a semi-detached property, up 1.7% when compared with the same month in 2024. Meanwhile, only 19% purchased a flat, representing a 2.7% annual decline. The most popular property type among new homeowners was three-bedroom properties, which accounted for 46% of all FTB purchases in August.

Looking for the long-term
Historically, FTBs would enter the market by buying a smaller property, with the intention of moving up the ladder later. However, it seems that this trend is changing. Many new homeowners are aiming to purchase a longer-term home from the outset, rather than upsizing after a few years.

Longer mortgages
To afford larger homes, FTBs are opting for longer mortgages, with 41.3% taking out a mortgage of at least 30 years in August. In fact, 37% of borrowers said that mortgages spanning 30 to 40 years are more appealing because it meant lower monthly repayments. However, repaying a mortgage over a longer period means paying more interest overall, increasing the total cost of borrowing.

Your home may be repossessed if you do not keep up repayments on your mortgage

Sources:
https://www.thisismoney.co.uk/money/mortgageshome/article-15099631/First-time-buyers-mega-mortgages-buy-forever-home.html
https://www.msn.com/en-ie/money/homeandproperty/first-time-buyers-take-out-mega-mortgages-to-buy-a-forever-home/ar-AA1MC7gQ?ocid=finance-verthp-feeds&apiversion=v2&domshim=1&noservercache=1&noservertelemetry=1&batchservertelemetry=1&renderwebcomponents=1&wcseo=1