Figures* show that there are approximately 39,000 Google searches on average for ‘properties for sale’ in the UK per month. Despite a clear interest in the property market, this buying process can be particularly challenging for those getting onto the property ladder for the first time.
But what are first-time buyers really worrying about? The mortgage experts at money.co.uk surveyed 1,501 first-time buyers to discover what they are most fearful of when it came to buying their first home.
Top Five First-Time Buyers’ Fears Revealed (Fears %):
1. House value drop/negative equity 31
2. Saving enough deposit vs rise in house price 26
3. Unable to afford your mortgage long-term 22
4. COVID-19 influencing a spike in prices 13
5. Breaking up with S.O. after buying together 11
The biggest concern raised by first-time buyers is experiencing a ‘house value drop/negative equity’. In fact, 31% of respondents said they are worried about their property becoming less valuable than the remaining value of their mortgage.
Nisha Vaidya, mortgage editor at money.co.uk, said: “There are a few things you should keep in mind if you want to avoid negative equity. Firstly, it’s important to make sure you pay the market value for the property, so don’t shy away from negotiating on the asking price.
“Secondly, the larger your deposit, the more equity you will have in the property. So, if you are able to save enough, putting down a bigger deposit is a good idea.”
While putting down a larger deposit is a great way to unlock lower interest rates and better mitigate shifts in house prices, over a quarter of first-time buyers said they are worried that they wouldn’t be able to save at the same pace as the rise in house prices.