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UK first time buyer market share grows
Mar 30, 2024
UK first time buyer market share grows London
By   Internet
  • City News
  • UK Housing Market
  • First Time Buyers
  • Rental Pressure
Abstract: The increasing market share of first-time homebuyers in the UK housing market is noteworthy, reflecting the combined impact of various factors. According to research by Hampton, first-time homebuyers have accounted for 33% of home purchases in the UK so far in 2024, up from 29% last year. If this trend continues, the market share of first-time homebuyers will reach a historic high, whereas in 2014, this proportion was only 17%.

The rise in the market share of first-time homebuyers is mainly attributed to the combined effect of several factors. Firstly, the increased availability of high loan-to-value mortgages and the low-interest-rate environment have provided first-time homebuyers with more opportunities for homeownership and mortgage options. Many see it as an opportune time to purchase their first home as they can secure higher loan amounts at lower rates, making homeownership more feasible and attractive.


Secondly, the clampdown on renting out properties also contributes to the growth of first-time homebuyers. With the government regulating the rental market, conditions for renting properties have become stricter, potentially leading to rent hikes and decreased rental stability. This prompts some individuals to lean towards purchasing their own homes rather than enduring the uncertainty and unfavorable conditions of renting.


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Research by Hampton indicates a particularly significant increase in first-time homebuyers in the London area, possibly due to more pronounced pressures of rising house prices and rents in the region, motivating first-time homebuyers to seek their own housing solutions. This reflects the active demand of first-time homebuyers in the housing market and their urgent desire to achieve homeownership in the current environment.


However, despite the increase in the market share of first-time homebuyers, the dominant players in the housing market are still those who have the ability to purchase homes. High house prices and elevated mortgage interest rates may limit the purchasing power of some individuals, forcing them to only afford smaller or cheaper homes. This indicates that while the market share of first-time homebuyers has increased, homeownership remains a challenge for ordinary families.


In the long term, it is necessary to closely monitor the trends of interest rates and house prices, as well as the potential supportive measures the government may take. Rising interest rates or continued soaring house prices may negatively impact the first-time homebuyer market. Therefore, maintaining low interest rates and stable house prices is key to sustaining the growth of the first-time homebuyer market. Additionally, the government can support first-time homebuyers through further policy measures, such as providing more homeownership subsidies or tax exemptions, to help them more easily enter the housing market.

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UK first time buyer market share grows
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