First-time homebuyers are showing increased confidence in their ability to purchase property this year, in contrast to last year’s more cautious outlook. According to the Building Societies Association (BSA), 33% of first-time buyers feel that now is an ideal time to buy, a significant increase from just 17% a year ago. Meanwhile, only 20% of the general UK population shares this sentiment.
A key factor behind this renewed optimism is the Bank of England’s recent series of base rate cuts, which have helped reduce some financial pressures. However, first-time buyers continue to struggle with affordability issues and the challenge of saving for a deposit. Despite changes to stamp duty in April that will raise taxes for first-time buyers, the impact of this change doesn’t appear to be a major deterrent for most. The BSA’s research found that only 16% of first-time buyers consider stamp duty an obstacle, compared to 22% of the broader public.
In terms of mortgage concerns, the majority of homeowners seem relatively secure, with just 6% expressing concerns about making their mortgage payments over the next six months—down from 12% a year ago. Meanwhile, property sales experienced a slow start in January, though the Royal Institution of Chartered Surveyors (RICS) forecasts that market activity will pick up in the coming months.
The housing market is currently experiencing a wide range of options for buyers, with more properties being listed ahead of Spring. However, sellers must price their homes competitively if they want to attract interest, as house prices in February saw a modest 0.5% rise, slower than the usual 0.8% increase for this time of year. First-time buyer homes saw a slight dip of 0.1% in asking prices, while larger properties experienced a 0.6% uptick. The average price of homes on the market is currently £367,994.
Despite a stable start to the year in terms of buyer interest, with new inquiries balanced, the outlook for the rest of the year is more optimistic. Sales are expected to rise in the short term. Over half of respondents (55%) believe property prices will continue to climb over the next year, with 22% already reporting higher prices by January. The strongest price growth is being seen in Northern Ireland and the North West of England, while regions like Yorkshire & the Humber and the South East are seeing more gradual increases.
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