Buying Via Shared Ownership Remains Attractive For First-Timers
The recent market survey of 2,600 first-time buyers (FTBs) revealed the majority of solo buyers are planning to purchase a new home with the help of Shared Ownership.
New market data revealed several curious trends in the property market, including the FTB segment. What are the main findings?
First-Timers Sector
On average, a single buyer needs £74,400 to secure a mortgage on the open market, given the current settings. As a result, it is little surprise that 77% of respondents confirm that they can't afford to buy a new property on the open market without taking advantage of supporting schemes, such as Shared Ownership, Mortgage Guarantee, and First Homes.
In particular, Shared Ownership is a government-backed initiative that offers buyers to purchase a share in a property, pay a mortgage on the part they own, and a discounted rent on the rest. Since buyers only need a small mortgage, a deposit is often much lower than buying a similar home for sale.
Market Trends In 2023
So far in 2023, rising interest rates and living costs continue to affect property buyers, including those looking for London new builds, as the capital also responds to economic uncertainty.
Even though 71% of respondents say the living costs crisis affects their homeownership plans, 60% of those considering Shared Ownership plan to buy a new home within this year. Interestingly, 76% of buyers say they have not received and don't expect any funds from parents or family members to save their deposit.
Specialists Explain
Most experts highlight challenging market settings for buying a property, which is justified. The increased interest rates and rising living costs significantly affect homeownership plans across all market sectors, from first-timers to premium property investors.
As a result, homebuying incentives and supporting schemes, including Shared Ownership, are as critical as ever. They allow prospective buyers to secure home deals in conditions that they otherwise wouldn't have been able to handle. And it's evident that the demand is strong, as 60% of buyers plan to purchase a new home within the next 12 months. With the help of buying schemes, they are somewhat protected from skyrocketing deposits and volatile mortgage rates.
In addition, the fact that the majority of Shared Ownership buyers only rely on their own funds reflects the critical impact of this scheme on the whole property market.
