First time buyers in Sussex could have a more affordable start on the property ladder

While homeowners might be pleased to hear the value of their home is increasing, it means first-time buyers are facing more challenges if they want to buy their own home.

Friday, 18th June 2021, 3:46 pm
Dream of owning your own home?
Dream of owning your own home?

The percentage of millennials who actually own a permanent house in Sussex and across the UK is dwindling but the desire to own has increased.

The Government has reported demand for home ownership soared during lockdown, with nearly 80 per cent of private renters now saving for a deposit

It is also said that millennials now spend, on average, one quarter of their entire salary on housing – three times more than the 70+ generation.

DM21060302a.jpg. The Housing Minister, the Rt. Hon Christopher Pincher MP visits Zedfactory at Barlavington near Petworth, to hear about the zero-carbon homes being assembled at the factory. Pictured with Chris Eastman, construction technician. Photo by Derek Martin Photography. SUS-211006-131904008

People of all ages can face problems when trying to buy their first home – issues include hefty deposits and unaffordable mortgage repayments. Parts of Sussex are very expensive and many may move away from family and work in order to find affordable alternatives.

Last week, Housing Minister Christopher Pincher MP visited Zedfactory in Sussex to see its cheaper and greener construction methods. Find out more about Zedfactory and his visit here.

During his visit, he spoke about the problems faced by first-time buyers in Sussex and what the Government is doing to help.

Mr Pincher said: “We want people to have choice. Whether they want to rent or whether they want to buy. The problem comes when those who want to buy their own home don’t have a choice and that, as a Government, is what we want to try and address. We want to make sure people have a choice and can afford their own home.

DM21060287a.jpg. The Housing Minister, the Rt. Hon Christopher Pincher MP visits Zedfactory at Barlavington near Petworth, to hear about the zero-carbon homes being assembled at the factory. Photo by Derek Martin Photography. SUS-211006-131834008

He added: “As a country we need more homes for people to live in and it is about building the right homes in the right places and making sure that they are affordable.

“One of the ways we are doing this is with the First Homes initiative which is designed to help first-time buyers and our key workers, such as nurses, supermarket workers and delivery drivers. All those people who we have all come to appreciate so much throughout the pandemic.”

Mr Pincher explained it will be down to the local authorities to decide where there is greatest need and then make these new affordable homes available for those particular people at a discounted rate.

The homes will be discounted by 30 percent and that discount will be perpetual and passed on when the property is sold years later.

DM21060284a.jpg. The Housing Minister, the Rt. Hon Christopher Pincher MP visits Zedfactory at Barlavington near Petworth, to hear about the zero-carbon homes being assembled at the factory. Photo by Derek Martin Photography. SUS-211006-131824008

With a Stamp Duty holiday and having spent more time indoors, it is thought the Covid lockdowns have led to many of us reassessing our lifestyles.

The desire for more green space and a dedicated home office means estate agents have become busier and some Londoners look to move to cheaper, commutable towns.

This sees a greater demand for properties in counties such as Sussex and a likely rise in property prices which could force many, especially first-time buyers, to move out of town to find more affordable homes.

Mr Pincher said he thought it would be some time until the effects of Covid-19 on the housing market became clear, but agreed the lockdowns may have played some part in people’s decision to move.

Young people are finding it increasingly difficult to get on the property ladder

He said: “We want people to live close to where they work and close to where their family live. This means less travel which is beneficial for the environment. It means a more prosperous and ecologically friendly life.”

He said he hopes the First Home initiative will go some way to help make this possible and will be most effective when allowing local authorities to identify the need in their own areas – whether that be first-time buyers, local key workers, veterans or retirement properties.

Making affordable homes exclusively available for certain groups of buyers could help to address some housing problems faced by people in Sussex.

The 95 per cent mortgage scheme has also given some first-time buyers hope. Launched in the Budget in April this year, high street banks are now able to offer the scheme – halving the 10 per cent deposit usually required.

According to research by the CreditLadder and Equifax, the average first-time buyers’ deposit is nearly £59,000, £12,000 more than a year ago.

The research found lack of savings for a deposit is preventing more than a third (34 per cent) of first-time buyers getting on the property ladder. However, 33 per cent see the new five per cent deposit mortgage scheme as the help they need.

Sheraz Dar, chief executive of CreditLadder, said: “A reduced deposit isn’t the only thing needed to help those trying to get on the property ladder. “One in five respondents to our research also said that the Stamp Duty holiday introduced last July had prompted them to look at buying a property and if it were completely removed for properties under £500,000 nearly half (48 per cent) said it would encourage them to think about buying a property in the next 12-months.”

The Stamp Duty holiday will end on June 30.

Lisa Hardstaff, head of customer experience at Equifax, said: “The research clearly demonstrates the barriers first-time buyers are facing. However, it is not just about how much you can afford, the deposit raised or what type of mortgage is required – first-time buyers need to be ‘mortgage ready’ when it comes to their credit information too.”

It is possible to add rental payments to your credit report information and strengthen your credit history.

Find out more at Equifax Homebuyer Handbook which can be found at here.

Research by Homedit.com has looked at the best, and worst, cities for millennials to buy a home based on eight criteria including average house price, ultra-fast broadband availability, OFSTED rating for nurseries and primary schools, and pubs and bars per person.

They ranked each city’s data on a scale of zero to 100 per cent based on their performance in relation to all other cities in the UK.

The two cities in Sussex were at opposite ends of the spectrum.

Chichester is the joint-second worst city, finishing with a total of 22/100 points. The city’s worst factor is its percentage of millennials in comparison to the rest of the population - the lowest in the UK. Brighton and Hove sits within the top ten – in ninth place. The vibrant city scored highly in every area with a high proportion of millenials, pubs, bars, green space and great internet connection. However, and probably most importantly, the affordability factor, much like its neighbouring city Chichester, was incredibly low at just nine per cent making it very difficult for first-time buyers in both Sussex cities.