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First-time buyers pressing ahead as March Help to Buy deadline draws nearer
Criteria searches for Help to Buy Equity Loan Scheme up by 10% in February. ‘Visa’ remains most used criteria, holding the top spot since 1st October.
9 Mar 2023
Data from Legal & General’s SmartrFit tool has today revealed that first-time buyers are persisting with Help to Buy purchases, with the 31 March cut-off-point fast approaching.
First-time buyers press ahead as March Help to Buy deadline looms
Introduced in 2021, as a replacement for the original Help to Buy scheme, the Help to Buy Equity Loan Scheme is set to end at the end of the month. The new scheme is only available to first-time buyers, and this is reflected in the data. Criteria searches for Help to Buy increased by 10% in February. Whilst in the same month, First Time Buyer searches rose by 12%.
Overseas interest in the UK market remains buoyant
For consecutive months, Visa has remained the most used criteria search for applicants. 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.
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 economy 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.
Cost-of-living remains a key concern
Finally, the February data confirms how rising living costs are still impacting mortgage applicants. Searches for applicants with a second job increased by 19% and applicants with zero-hour contracts rose by 43%.
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.
Jodie White, Head of Mortgage Products & Transformation, Legal & General Technology: “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.”“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 a welcome addition to speed up the homebuying journey and improve efficiency across the board.”
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Notes to editors
Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with £1.2 trillion in total assets under management (as at HY24) of which c40% (circa £0.5 trillion) is international.
We have a highly synergistic business model, which continues to drive strong returns. We are a leading international player in Institutional Retirement, in Retail Savings and Protection, and in both public and private markets through our Asset Management division. Across the Group, we are committed to responsible investing and dedicated to serving the long-term savings and investment needs of customers and society.
As at 11 December 2024, Legal & General has a market capitalisation of 13.7 billion.
Legal & General Retail helps create brighter financial futures for all our customers. The division covers the savings, protection and retirement needs of our c.14 million retail policyholders and workplace members.
In 2023, we had total individual annuity sales of £1,431 million, and issued £299 million of Lifetime Mortgages and Retirement Interest Only Mortgages. Our Workplace pension platform served 5.2 million members, while our Protection businesses gave peace of mind to several million direct, group and US customers, taking in £1,991 million of UK and $1,584 million of US gross written premiums.