Here’s some good news to guide first-time-buyers
January, 2024

Interest rates are reducing, and lenders are offering increasingly competitive deals, especially to those with good deposits. Both ready-to-move-in homes and homes in need of modernisation are available for you to take your first steps. But even if you don’t have a large deposit, you can still make your first move.

Mortgage Guarantee Scheme is extended

This is great news for those with a 5% deposit. The government-backed Mortgage Guarantee Scheme, which was due to end in December 2023, has been extended until June 2025. Thousands of first-time-buyers have benefited from this scheme, which was introduced in April 2021. If your budget allows, homes with a value of up to £600,000 can benefit from the scheme.

Less competition and lower interest rates

Higher interest rates have meant some people hoping to get on the property ladder have been priced out of the market. This is good news for you, as you have fewer buyers to compete with, and the bigger your deposit, the smaller your interest mortgage rate will be. Though the first-time buyer market has been outperforming other sectors, a little less competition means house price inflation has reduced. A sure way to get ahead of the competition is by keeping up good communication with your local agent, who will contact you immediately when a suitable home becomes available.

With some landlords retiring and others being scared away by imminent legislative changes, more first-time buyer-type homes are entering the market. If you are looking for a flat, apartment, or two-bed terraced home, you may find certain locations offer a little more choice. That said, properties of this type are in high demand, so it pays to be organised. Have your deposit ready and get an agreement in principle from your mortgage adviser so you can get a viewing quickly.

Homeowners ascending the ladder

As homeowners of first-time buyer-type properties put their homes on the market to move to second-stepper homes, you will benefit from increased choice. Lowering interest rates and better deals with an increasing range of mortgage products mean the market is moving again. The beginning of the year is also a time when people begin their search for a new home with a renewed sense of vigour. Some home movers will choose to put their homes on the market, hoping to be chain-free buyers when it’s time to make an offer. This is another advantage of being a first-time buyer: you are chain-free and often the preferred choice of sellers.

Trust your agent

Knowing where good starter homes are located, which locations are the best places to buy, and simply finding your potential property makes hunting for a home with your agent the way to go. You could spend hours searching property portals and miss out on what’s under your nose and already listed with your local agent. They are also aware of any properties coming onto the market. If this is your first property purchase, their knowledge and support offer a lot of comfort and reassurance by happily answering the hundreds of questions that will play on your mind. And if you need to source a good mortgage adviser, conveyancer, or other property-related professionals, they will gladly connect you to the right people.