Nearly half of first-time buyers ‘have had a property purchase fall through’

Nearly half (49%) of recent first-time buyers have had a house purchase fall through, a survey has found.

Many of those whose purchase had fallen through said is was due to the coronavirus lockdowns, according to Aldermore bank.

Those who did get on the property ladder between March 2020 and March 2021 said they faced a two-month delay on average.

They racked up £5,870 in added costs typically due to the impact of the pandemic in slowing down the buying process, the survey found.

More than two thirds (70%) say they spent more money than they had intended to on their house purchase.

The average amount wasted by first-time buyers meanwhile on purchases which did not complete was £2,912, it was found.

On average, people still looking to get onto the property ladder said they had delayed their purchase by eight-and-a-half months due to the pandemic. This could cost some people extra money in rent while they have a longer wait to make a purchase.

However, a string of lenders have relaunched 5% deposit deals in recent weeks, many of them backed by a new Government mortgage guarantee scheme.

Despite setbacks and delays, nearly two thirds (63%) of prospective first-time buyers said they are now more motivated to buy – although for many the type of home they are looking to purchase has changed.

Two thirds (67%) said they are reconsidering the type of property they want to purchase due to Covid-19, with gardens, balconies, close proximity to parks, home office spaces and good broadband connections becoming bigger priorities.

For six in 10 (62%) new buyers, close proximity to loved ones is an important consideration.

Jon Cooper, head of mortgage distribution at Aldermore, said: “The Covid-19 pandemic has motivated a great number of people to buy their first home.

“It is important, alongside raising a deposit, to identify and factor in any additional costs, such as solicitor, valuation and estate agent fees, as well as moving costs, all of which can add up.

“Seeking advice from a financial adviser or broker will help greatly in making the process less confusing.

“Although buying a house has its challenges, the reward can be great, illustrated by the large number of first-time buyers (84%) who said the stress was worth it and that becoming a home owner has been extremely rewarding.

“Successive lockdowns over the past year have made us all re-evaluate how we live our lives, and what we need from our homes. It is no longer just a place to live, but a place of work, and where we exercise, educate our kids, and socialise. As a result, the data shows a dramatic change in preference in the types of properties new buyers are looking for.”

In March 2021, researchers Opinium surveyed more than 1,000 prospective first-time buyers and 300 who had bought their first home between March 2020 and March 2021, to produce the findings.