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Indirect boost for rental market as first time buyers defer plans

24 September 2020 | Renting

Indirect boost for rental market as first time buyers defer plans

Nearly half of prospective home buyers have delayed their plans because of the Coronavirus crisis, a mortgage company says.

Research by Aldermore shows the average delay as 11.4 months.

Since the start of the pandemic 17 per cent of prospective FTBs have had a purchase collapse and 20 per cent say they had to pull out of buying a property because of the spring lockdown.

Perhaps unsurprisingly many are now worried about their financial security and 41 per cent say the pandemic has made it harder for them to buy.

Lockdown has prompted 39 per cent of prospective buyers to reconsider what type of property they are looking for – having a garden, balcony or other open space is a priority for 42 per cent, while 33 per want homes near countryside or parks.

At the same time, however, 38 per cent say there are now fewer properties on sale that tick their boxes. 

Around 50 per cent of prospective FTBs wanting to purchase by late 2021 say that the stamp duty holiday is likely to help them and a quarter say the tax cut has brought forward their home buying plans, in order to meet the March 31 deadline.

Aldermore head of mortgage distribution Jon Cooper says: “First time buyers experience strong financial and emotional challenges at the best of times as they go through the home buying journey, but it appears now this has been heightened by Covid-19. 

“The wider economic recovery will be the real determining factor for how the first time buyer market performs this year. 

“First time buyers need job security if they are to feel confident in taking the plunge in what is one of the biggest financial investments of their lives.”

This post has originally been featured in Letting Agent Today.