First-Time Buyers: The Struggle is Real

The UK’s housing market has reached a critical point, with affordability at an all-time low. For first-time buyers, the dream of owning a home seems more elusive than ever. But amidst the gloom, there’s a glimmer of hope. Building societies are innovating to support first-time buyers, offering competitive rates and innovative financing products.

According to data from Moneyfactscompare.co.uk, mutuals are leading the way in providing affordable mortgage options for first-time buyers. Skipton Building Society’s Track Record mortgage, Yorkshire Building Society’s £5,000 deposit mortgage, and a collaborative initiative between Leeds Building Society and Experian are just a few examples of the innovative solutions being offered.

While high street banks may offer lower average rates, building societies are providing more competitive packages for first-time buyers. As Rachel Springall, finance expert at Moneyfactscompare.co.uk, notes, “Mutuals which offer two- or five-year fixed rate deals available to first-time buyers with a 5% or 10% deposit currently charge less on average compared to the market average in the same space.”

However, the biggest high street banks offer some of the lowest fixed rates in the same sectors, and indeed seven banks are priced lower, on average, than mutuals. As Paul Broadhead, head of mortgage and housing policy at the Building Societies Association, remarks, “Becoming a first-time buyer is possibly the most expensive it has been over at least the last 70 years, but a properly functioning housing market is dependent on first-time buyers being able to afford their first home.”

The challenge for first-time buyers is affordability, with interest rates higher than expected this year, and affordable housing remaining in short supply. But with the support of building societies and innovative financing products, there’s hope on the horizon.

Mortgage rates are rising, but there’s still hope for first-time buyers

In a recent study by Coventry Building Society for Intermediaries, regional differences were identified as a significant barrier to first-time buyers. However, with the right advice and support, it’s possible to navigate these challenges and find the right deal.

As Rachel Springall notes, “Any borrower looking to get their foot on the property ladder would be wise to seek independent advice to ensure they find the right deal for them.”

In this challenging market, it’s more important than ever to stay informed and seek expert advice. With the right support and innovative financing products, first-time buyers can still achieve their dream of homeownership.

First-time buyers can still achieve their dream of homeownership