Hidden costs have become one of the biggest concerns for aspiring homeowners with younger buyers particularly worried about the unexpected expenses involved in purchasing their first property.
New research from Mortgage Advice Bureau (MAB) found that almost a third (29%) of first-time buyers see costs such as Stamp Duty, legal fees and moving expenses as one of the biggest barriers to getting onto the property ladder.
However, the study found that concerns vary considerably depending on age, reflecting the different financial challenges faced at each stage of the homebuying journey.
Among buyers aged 18 to 24, hidden costs emerged as the single biggest concern, cited by 38% of respondents. More than a third (36%) also expressed concerns about job security and income stability, highlighting the financial uncertainty facing many younger adults as they attempt to buy their first home.
AFFORDABILITY ISSUES
For buyers aged between 25 and 30, affordability remains the dominant issue. More than half (56%) identified high house prices as their biggest challenge, while 37% pointed to rising mortgage rates as a major concern.
The focus then shifts again among older millennials. More than a third (36%) of buyers aged between 31 and 40 said unexpected repair and maintenance costs were their biggest concern, suggesting worries move beyond purchasing a property and towards the long-term realities of homeownership.
The findings indicate that first-time buyers are increasingly concerned not only about affording a home, but also about the financial commitments that come with owning one.
The research also uncovered a lack of awareness around some of the specialist mortgage products designed to help address affordability challenges.
Just 19% of buyers aged 25 to 30 said they had heard of track record mortgages, which use rental payment histories to support affordability assessments. Awareness among 18 to 24-year-olds was even lower at 15%.
FINANCIAL PRESSURES
Rachel Geddes, Strategic Lender Relationship Director at Mortgage Advice Bureau, says: “Our research shows there’s no longer a one-size-fits-all first-time buyer journey.
“Every generation is facing a different set of financial pressures and priorities when it comes to getting onto the property ladder.
“Many of these concerns are completely understandable, particularly at a time when affordability pressures remain high and buyers are trying to navigate rising living costs alongside saving for a home.
“However, there are now far more flexible lending solutions and affordability-focused products available than many people realise, designed specifically to help first-time buyers overcome some of these financial barriers.”
The findings come as affordability pressures continue to shape the housing market, with many first-time buyers balancing higher living costs, mortgage affordability tests and rising property prices while attempting to save for a deposit.
