One in four first-time buyers were turned down for a mortgage when they first applied though their bank, a new study has revealed.
Data out today from specialist lender Aldermore showed refusals were even more common in London, where nearly half of first-time buyers had applications rejected.
It’s one of many challenges and pitfalls to have been revealed by Aldermore’s First Time Buyer Index which looked into the many difficulties people faced when buying their first home.
It revealed nearly half of first-time buyers had experience of at least one property purchase falling through – a figure which increased to 73% in London.
Raising a deposit was also named as the biggest hurdle for 40% of prospective first-time buyers, which is an increase on the number who faced this problem last year.
Prospect first-time homeowners even offered their own suggestions of how the Government could make things easier for first-time buyers. A popular idea was to make sellers pay the stamp duty instead of buyers or abolish the tax altogether.
Meanwhile, others said they would like to see more building on the Green Belt and increased prefabricated homes available to first-time buyers.
Charles McDowell, commercial director of mortgages at Aldermore, said the housing market was in a state of flux leaving first-time buyers anxious, stressed and out of pocket.
He added: “We believe the real crux to fixing the broken housing market is to improve and increase housing stock. This is echoed by over a quarter of first-time buyers who would like to see more building on the Green Belt.
“While the Chancellor of the Exchequer announced some measures to build new homes in the Autumn Budget last year, given the Government’s record on house building, it is necessary to make some serious progress. We need real action and results, not more consultations and whitepapers, because this cannot continue.”
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