"Lower mortgage rates and improving mortgage availability have supported the growth in FTB numbers across the country."
Zoopla's report shows that over the next 18 months weaker growth in first-time buyer volumes in London and the South East will be off-set by continued growth in regional markets.
Its report found that first-time buyers are now taking a longer term view, typically seeking three-bedroom properties that they can stay in longer and grow into. Zoopla says there is no evidence FTBs are rushing into buying smaller, lower value homes in order to force their way onto the market.
Today, the average price of homes bought by first-time buyers outside London is just 8% lower than the regional average. Between 1996 and 2007 first-time buyers bought homes that were priced at 20% less than the regional average.
Richard Donnell, research and insight director at Zoopla, commented: “First-time buyers have been the driving force behind the housing sales market in recent years. Lower mortgage rates and improving mortgage availability have supported the growth in FTB numbers across the country. Despite increased barriers from high house prices in southern England and mortgage regulations, the appetite to buy their first home remains strong. Whilst the outlook is more challenging in London, growth in FTB volumes is expected to be driven in regional markets where affordability remains attractive, supported by greater availability of higher loan to value mortgages.
“The greatest potential for further growth in first-time buyer numbers is in the North West and Scotland, where growth has been most robust recently. Changes to the Help to Buy scheme in England from 2021 could have an impact on the 14% of FTBs using this scheme to buy their first home. However, the impact could be off-set by higher loan to value lending and newer forms of tenure such as shared ownership. First-time buyers will be the largest buyer group this year and there is no evidence that the long run appetite for home ownership will diminish any time soon.”
