Online mortgage firm Trussle has released new data revealing that the COVID-19 pandemic led to a huge spike in the number of applications for mortgages from first-time homebuyers.
According to this data, there was a 185% increase in the number of loan applications from people looking to buy their first home during 2020, and that has carried on into this year so far. The first three months of this year have brought a further 74% rise in first-time homebuyer mortgage applications.
These figures are very surprising, given the economic effects that the pandemic has had on younger people. Trussle states that more of these buyers are currently managing to afford deposits above £15,000, with the number rising to 87% during 2021, compared with 73% last year.
According to Mortgage Strategy, the statement issued by Trussle says that:
“Faced with limited spending options due to less commuting and the closure of hospitality and retail, many buyers have been able to use the lockdown period to review their finances with the hopes of buying a new home.”
The company goes on to say that many younger first-time homebuyers had managed to save the money needed for a deposit by temporarily returning to live with their families, while the holiday on paying stamp duty had also had an effect.
The entry of more first-time buyers will help to energise the mortgage market after COVID-19 and will make them a demographic that advisors will want to target upon the completion of their CeMAP mortgage advisor training courses.