The Council of Mortgage Lenders recently penned a detailed analysis of first-time buyer activity in 2014 to underline the momentum coursing through this sector.
Last year, more than 300,000 buyers purchased their first home – the largest number since 2007. First-time buyers also continued to account for an increasing proportion of the overall market – 46 per cent of all purchases.
The Government’s Help to Buy scheme has played a major part in this growth. Since the launch of the first phase nearly two years ago, more than 80,000 borrowers have purchased a home in this way.
However, while CML figures show 48 per cent of new-buyer purchases to be ‘unassisted’ – up from 34 per cent in 2011 – the importance of financial support from parents and/or grandparents for many first-time buyers should not be under-estimated when raising a sufficient deposit.
The ‘Bank of Mum and Dad’ may face increased pressure when the Help to Buy scheme is wound down next year. So lenders will have to continue creating a host of innovative solutions to further support first-time buyers, all within the new regulatory landscape.