Chancellor Rachel Reeves has backed building societies’ efforts to help first-time buyers as new research reveals a stark disconnect between aspiration and action among would-be homeowners.
The Chancellor met senior leaders from 13 mutual lenders in Leeds to discuss how the sector is supporting buyers facing high house prices, affordability pressures and increasingly complex income patterns.
Research from the Building Societies Association (BSA) shows that 67% of aspiring first-time buyers said they could purchase sooner than expected when shown mortgages requiring low or no deposits.
However, almost half (47%) of those who want to buy have never spoken to a lender or broker about what they could afford. In Yorkshire, that figure rises to 59%, while more than half (54%) of those who have sought advice have not done so in the past year.
PERCEPTION GAP
The findings point to what the BSA describes as a “perception gap”, with many renters assuming homeownership is out of reach without checking their options.
Building societies now account for 35% of all first-time buyer lending. Nearly half (46%) of that lending goes to borrowers under 30, 23% supports buyers with deposits of less than 5%, and 10% goes to first-time buyers aged over 45.
At the roundtable, lenders including Nationwide, Coventry Building Society, Leeds Building Society, Yorkshire Building Society and Skipton Building Society outlined how they are adapting criteria to reflect modern working patterns, including self-employment, variable income and smaller deposits.
Rachel Reeves (main picture, inset), Chancellor of the Exchequer, says: “For too long, homeownership has felt out of reach for young people.
“We’re changing that by building 1.5 million new homes this Parliament and reforming mortgage rules so more first-time buyers can get the keys to their first home. I welcome the Building Societies Association’s work to help people understand the options available to them.”
FIRST-TIME BUYER OPTIONS
Sarah Harrison, Chief Executive of the Building Societies Association, adds: “We welcome the Chancellor’s support for our ‘think again’ campaign and the opportunity to discuss with her how building societies are helping first-time-buyers across the country – and how with her support we can do even more.
“Too many people assume homeownership is out of reach without ever checking what is available to them. Building societies were set up to help ordinary working people buy their own homes, and that hasn’t changed.
“Whether it’s a smaller deposit, flexible ways of looking at income and affordability, or support for people whose circumstances aren’t straightforward, there are more options onto the property ladder than many first-time buyers realise.
“It’s worth anyone thinking about buying their own home to have a chat with a building society or mortgage broker, it could be the difference between thinking ‘maybe one day’ to ‘why not now’.”
HELPING HOMEOWNERSHIP DREAM
Annette Barnes, Interim Chief Executive of Leeds Building Society, says: “It was fantastic to give the Chancellor the chance to meet some of our members who’ve benefited from changes we’ve made to be able to buy their first home.
“For example, we lowered the minimum household income required to apply for one of our Income Plus mortgages to £30,000.
“We’re always looking for new ways to responsibly help more people achieve their homeownership dream.”
