First-time buyers are pushing ahead with Help to Buy purchases, even as the 10-year programme comes to an end this month, data from Legal & General shows.
Broker searches for the Help to Buy Equity Loan scheme – which is only available to first-time buyers – lifted by 10% in February, according to the financial services firm’s SmartrFit criteria tool, while in the same month, FTB searches rose by 12%.
The programme ends on 31 March, after first being introduced, and running in various formats, in 2013.
The criteria tool also revealed how the cost-of-living crisis affects mortgage applicants.
It says that searches for applicants with a second job increased by 19% in February, while enquires for applicants with zero-hour contracts rose by 43%.
The firm says: “These figures indicate the financial pressures of applicants in needing a higher income to make mortgage payments.
“Figures of missed mortgage payments rising by 14% and a 48% increase in payday loans show the direct impact of rising living costs.”
Data from the search tool also show that Visa requirement enquires have remained the most used criteria search for applicants for the second month in a row.
The company says: “This consistency highlights the important role advisers play in securing foreign investment and the resilient nature of London’s housing market.
“Foreign interest in the London area has grown in 2023 with criteria searches from expat/EU citizen in UK applicants rising by 9% in February.”
It adds: “Foreign investors see London as an ever-growing market and confidence is high with foreign income applicants increasing by 12%.
“The capital, forecasted as a future ‘megacity’, is expected to lead the UK economic recovery, with the housing market playing a key role.
“London has always been viewed as a desirable city and further investment from foreign sources will lead to greater comparisons with cities like New York.”
Legal & General Technology head of mortgage products & transformation Jodie White points out: “The increased search results in the Help to Buy scheme show there is still strong demand for schemes which help first-time buyers take a step onto the property ladder.
“The Help to Buy scheme has been a vital tool in helping new homebuyers. As the last elements of the scheme come to an end, there is a real need for new technology-driven initiatives to support brokers and their first-time buyer clients.”
White adds: “Advisers will be key to supporting this segment of the market, but they also have a key role to play for other customers, such as existing homeowners who need to remortgage.
“To do this effectively, they need access to the right tools and tech. The more that the industry can digitise the mortgage journey, and streamline processes, the better for clients and advisers alike.
“Indeed, everything from developing cutting edge product sourcing tools, to implementing digital ID and Open Banking, are welcome additions to speeding up the homebuying journey and improve efficiency across the board.”
