Half of first time buyers delaying home buying plans by an average of almost a year due to COVID-19

POSTED: 22nd September 2020
IN: Newsroom
  • Nearly half (46%) of prospective first time buyers say their home buying plans have been delayed by Covid-19, by an average of 11.4 months
  • One in six (17%) had a property sale fall through due to the pandemic, and one in five (20%) say they had to pull out of buying a property due to lockdown
  • One in two (49%) say they are now worried about their financial security and two in five (41%) say the pandemic has made it harder to buy than before
  • Two in five (39%) are reconsidering their property type due to lockdown

Aldermore bank’s First Time Buyer Index1, a survey of 1,000 prospective first time buyers, reveals the Covid-19 pandemic has had huge ramifications on new buyers’ ability to buy their first home.  

Rising challenges for first time buyers

The pandemic has caused nearly half (46%) of first time buyers to delay their plans of purchasing a home, by an average time of nearly a year (11.4 months). Many have also experienced failed attempts to buy due to the lockdown period, with one in six (17%) having a property sale fall through and one in five (20%) saying they pulled out of buying due to lockdown. The pandemic has also caused one in two (49%) first time buyers to worry about their financial security. 

Changing demands of property types

Two fifths (39%) of prospective first time buyers are now reconsidering their property type due to lockdown, with four in 10 (42%) saying that having a garden or balcony is a top priority and a third (33%) now looking for properties near the countryside or parks. However, two in five (38%) say there are fewer properties on sale now which fit their preferences.

Stamp duty holiday proves popular

The Government’s bid to revive the housing market with a stamp duty holiday for England and Northern Ireland, announced in July, has proven to be popular among prospective first time buyers. Nearly a third (31%) believe it will be a big help to them, rising to half (47%) of those looking to buy their first home in the next 12 months.

Furthermore, a quarter (24%) say the stamp duty holiday has brought forward their home buying plans, in order to meet the 31st March 2021 deadline, and a further fifth (21%) say they will borrow money from friends and family to buy ahead of the deadline.

Home ownership remains a dream

Despite increased difficulties, prospective first time buyers have not had their home buying dreams dampened, with two in five (42%) saying they are more motivated to buy now than they were before lockdown. However, the same proportion (42%) felt lockdown had made the journey more stressful.

Jon Cooper, head of mortgage distribution, Aldermore said: “First time buyers experience strong financial and emotional challenges at the best of times as they go through the home buying journey, but it appears now this has been heightened by Covid-19. The wider economic recovery will be the real determining factor for how the first time buyer market performs this year. First time buyers need job security if they are to feel confident in taking the plunge in what is one of the biggest financial investments of their lives. 

“It’s encouraging to see increased delays and challenges have not dampened prospective buyers home buying dreams, in fact they appear more motivated than ever after the lockdown experience. It’s important as conditions continue to change that new buyers seek expert advice from brokers who will be able to outline options and help ease the confusion of the process that many feel.

“Stamp duty relief also appears to have received a positive response from first time buyers, with many seeing it as a welcome boost. The initial costs of getting on the ladder can be a real barrier to many, so anything that helps reduce that entry fee for some is welcome for the housing market.”

-ENDS-

Notes to editors:

1Research conducted by Opinium August 2020, with a nationally representative sample of 1,009 prospective first-time buyers.

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