With interest rates rising, and the cost-of-living crisis only getting worse, first-time buyers are beginning to delay purchasing their first home by two years.
This information has come from a survey of 2,000 potential first-time buyers conducted by challenger bank brand, Aldermore.
Seven out of 10 (72%) respondents have stated that their attempts to purchase their first home have been affected by the cost-of-living crisis.
This has resulted in a third of budding property buyers delaying their efforts at getting on the property ladder. On average, first-time buyers are seeing delays of 20 months.
Jon Cooper, head of mortgage distribution at Aldermore, said: “While saving in this current economic climate may feel like a long and arduous journey, we’ve found that the majority of determined first-time buyers think the difficulties are ultimately worth it in order to get on the property ladder.
“It’s important that prospective buyers are aware of the support available to them. Would-be buyers should consider seeking advice from a broker who can lend a helping hand and guide you through the process of becoming a homeowner.”
To aid with the struggles that first-time buyers are facing, Chancellor Kwasi Kwarteng has announced that once again, the stamp duty land tax (SDLT) is being cut.
Stamp duty is a one-off payment that a home buyer makes when they purchase a property over a certain threshold.
Consequently, no stamp duty will be paid for homes purchases over £250,000. The original threshold was £125,000.
For first-time buyers specifically, no stamp duty will be paid for properties over £425,000. The original threshold was £300,000.
Home movers can now save up to £2,500 and 200,000 more home buyers every year will pay no stamp duty at all.
Kwarteng stated that he has hoped the stamp duty cut would 'support growth, increase confidence and help families aspiring to own their own home'.
What will this do to house prices?
It is likely that the stamp duty cut will increase activity within the UK housing market. It puts home ownership in reach for more people.
A small number of experts have warned that the cut could push up house prices more.
Pete Mugleston, managing director of OnlineMortgageAdvisor, says: 'These measures will make it easier to get on the property ladder, increasing the mortgage options for a lot of people.
'That being said, this is a relatively short-term solution to the current issues in the housing market.
'The risk is that these measures could worsen inflation and drive-up house prices even more, making it harder long-term for first-time buyers to purchase a property.'
Previous stamp duty cuts significantly boosted the activity within the UK property market due to home buyers rushing to complete before the deadline.
However, the new stamp duty cut may not heat up the property market like experts have predicted as there is no deadline this time.
The cut will be set against a number of other factors that are currently working against the property market.
There is other help for first-time buyers also.
High street lenders are offering mortgages to borrowers with a deposit of just 5%. This is under a government guarantee scheme which launched in April 2021.
The policy is available to anyone who is buying a home under £600,000, unless it is a buy-to-property, a second home or in some cases, a new-build.
The scheme was designed to help first-time buyers secure a home and begin their journey on the property ladder.