New research from Halifax reveals the extent to which first-time buyers are prepared to compromise when facing difficulties buying their first home. Over six in ten (61%) said they are prepared to move to a different part of the country to get on the housing ladder.
With house prices for those buying for the first time almost doubling (up 94%) in just a decade, and the average age of a first-time buyer now 32, compared to 30 a decade earlier, the challenges are clear.
However, young people’s desire to own their first property remains consistently high (87%), with a third (33%) wanting to get on the ladder as soon as possible.
Looking further afield
Almost half (44%) of prospective first-time buyers looking to get on the housing ladder are now researching locations they wouldn’t have considered prior to the cost-of-living crisis.
There is a huge range in average first-time buyer house prices, from £112,112 in Inverclyde, to £682,981 in Westminster. With such variety across the country, many young people (40%) are actively exploring more affordable, up-and-coming areas to move to.
Over four in ten (41%) said that the location of their first home was more important than the property itself, with the research also highlighting first-time buyers’ top priorities when choosing where to buy.
Despite ‘proximity to family and friends’ appearing second on the list of top priorities, the fact “house price” appears top by some distance underscores why 61% of prospective first-time buyers are now willing to spread their nets and move further to get their foot on the property ladder.
Table 1: Halifax First-Time Buyer Report – Top priorities when choosing where to buy a home
||Consideration when choosing a location of first home
||% who selected as one of their top priorities
||The price of the house
||Being close to family and friends
||Crime rate in the area
||Community feel (friendly neighbours, community events etc.)
||Number of transport connections
||If there is a supermarket nearby
||Proximity of schools
||Better job prospects
||Proximity to a major city
Halifax has launched a First-Timer Buyer Report, combining its own house price data with a study of 3,000 18 to 34-year-olds yet to purchase a property, to better understand the challenges facing first-time buyers in 2023.
The report also shines a light on up-and-coming areas around the UK and advises how people can get started on their own homebuying journey.
With affordability topping the priorities list, Halifax has identified up-and-coming areas with lower average purchase prices compared to the surrounding region, and cross referenced with respondents’ priorities, including: crime rates, transport links to major cities, access to good schools or other education, proximity to green spaces, ultrafast broadband availability, as well as investment in local regeneration.
Table 2: Halifax First-Time Buyer Report – Up-and-coming locations for first-time buyers
|Location (Local Authority)
||Average first-time buyer purchase price
||Price compared to regional average (e.g. NW, East Mids, Scotland, Wales etc.)
|Kingston upon Hull - England
|Middlesbrough - England
|Neath Port Talbot - Wales
|Derry City and Strabane - Northern Ireland
|Falkirk - Scotland
|Blackburn with Darwen - England
|Aberdeen City - Scotland
|Telford and Wrekin - England
|Ipswich - England
|Eastbourne - England
Kim Kinnaird, Mortgages Director at Halifax, said, “Despite fluctuating house prices, the desire to buy a first home isn’t going away, with almost nine in ten young people keen to get on the property ladder.
“There’s an appetite from under 35s to consider more affordable areas further afield, so we’ve identified up-and-coming locations that prospective first-time buyers might do well to look into. These are based on relatively low average house prices, alongside other positives such as access to green spaces, easy commutes and safe neighbourhoods.
“Buying a home is daunting, especially if it’s your first time doing so. That’s why we've launched Halifax’s First-Time Buyer Report, which is full of information and tips to support those embarking on their home-buying journey”.
Further findings from Halifax’s research showed that various challenges in the housing market, including increasing mortgage rates, have affected many first-time buyers. As a result, four in ten (41%) are pushing back their house purchase plans by four years on average.
Over seven in ten (71%) say they are prioritising other purchases over a house – 31% say that they have deprioritised buying a home in favour of saving to go travelling, while 30% say finances for a car are now a bigger focus.
Decision to downsize
While decent square footage is on most homebuyers’ list of ‘must-haves’, almost half (49%) of those looking for a first home said they’ve downsized their expectations.
Over four in ten (46%) are now willing to consider homes up to a quarter smaller than their ideal size, while more than half (55%) would reassess the type of property they are willing to buy.
Almost a third (30%) of those surveyed said they don’t understand the home buying process, however Halifax experts have the following tips for those getting started on their homebuying journey:
• Don’t only look at house price: From community feel to green spaces, buyers should consider multiple factors and decide what’s really important to them when choosing a home. The Halifax location finder is a great way to explore new areas online.
• Drop by a Halifax Home Hub: Halifax Home Hubs are dedicated home buying spaces where anyone can drop in to chat and put a plan in place to get on the next step of the property ladder.
• Use a mortgage calculator: Halifax offers a free-to-use First Time Buyer Mortgage Calculator to help those starting their homebuying journey get to grips with potential costs
To view the Halifax First-Time Buyer Report and learn more about the house-buying process, visit www.halifax.co.uk/ftb2023.