Detached homes are proving more popular with first-time buyers for whom property size is becoming increasingly important, analysis by Accord Mortgages has revealed.
In the year before the financial crisis, nearly half of first-time buyer mortgages were being used to purchase a terraced house but by 2018 this number had fallen to 34%.
Meanwhile, during the same time period, the percentage of buyers opting for a detached home had doubled from 6% in 2007 to 12% in 2018, said Accord.
The analysis of first-time buyer mortgages was based on data from Accord’s parent organisation, Yorkshire Building Society. It discovered, of those stepping on the property ladder in 2007, the proportion buying homes with two bedrooms was much higher – at 38% compared with 32% in 2018.
But three and four bedroom homes have grown in popularity during the same time, with 52% of buyers taking out their first mortgage to buy a family home in 2007 compared to 61% in 2018.
More financial support
It is thought schemes such as Help to Buy and stamp duty relief for first-time buyers have given new buyers the financial support to choose larger properties and ‘future proof’ their purchase.
Accord also thinks the increasing availability of mortgages for borrowers with smaller deposits of 10% and 5% have also played a role in helping first-time buyers afford a ‘forever home’.
Nitesh Patel, strategic economist for Accord, also thought the wider availability of fixed-term mortgages had made it attractive for aspiring first-time buyers with the uncertainty around future interest rates.
Patel added: “Whilst our data shows the average age of a first-time buyer has only increased slightly since 2007, it follows that as the life ‘milestones’ of getting married and having children are being achieved later, that the majority (a quarter) of first-time buyers are now in the older age group of 30 to 34 as people choose to focus on their careers, travelling and enjoying a mortgage-free lifestyle in their 20s.”
