First-time buyers in Yorkshire go past 30,000 for first time since financial crash

The number of first-time buyers in Yorkshire is estimated to have gone past the 30,000 mark for the first time since before the financial crisis, according to analysis from the Yorkshire Building Society.
Nitesh Patel: “The performance of the first-timed buyer market in Yorkshire during 2021 has been extraordinary".Nitesh Patel: “The performance of the first-timed buyer market in Yorkshire during 2021 has been extraordinary".
Nitesh Patel: “The performance of the first-timed buyer market in Yorkshire during 2021 has been extraordinary".

Despite the uncertainties generated by the third lockdown in early 2021, latest estimates suggest the number of first-time buyer transaction reached 408,379 during the year which is a 37 per cent increase on 2020. First-time buyers now represent 47 per cent of all house purchases with a mortgage up from 37 per cent in 2007.

The previous first-time buyer peak in the region was as long ago as 2002, when 40,300 buyers took their first step on to the housing ladder.

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Falling unemployment, low borrowing costs and an increased number of low deposit mortgage deals are key drivers of current demand.

New buyers have not been deterred by the price of a typical first-time buyer home in Yorkshire which has increased by 10 per cent to £164,694 in the year to October, up from £149,139 a year earlier.

The ability of first-time buyers to increase the size of their deposits has been reinforced by the stamp duty holiday.

Nitesh Patel, Strategic Economist at Yorkshire Building Society, said: “The performance of the first-time buyer market in Yorkshire during 2021 has been extraordinary, particularly against the backdrop of uncertainties caused by the lockdown in the early months of the year.

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“There are some strong drivers of demand that explain the increased volumes.

“Low borrowing costs is an important factor and the increased availability of more low deposit mortgages has also been an enabler mostly for first-time buyers. Unemployment has also been falling for the last year and the jobs market has been getting stronger since the phased re-opening in April.

“Whilst first-time buyers don’t pay stamp duty on prices up to £300,000, new buyers looking to buy up to £500,000 would have benefited. In the near-term housing demand will continue to exceed supply, however with prices at an elevated level in comparison to local earnings, this should dampen activity. Therefore, it’s unlikely that we will continue to see first-time buyer numbers at this level in 2022 and beyond.”

Deposit sizes have increased due to saving rising with a sudden drop in expenditure during coronavirus lockdowns.

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