First-time buyers are around half as likely to have had opportunities to save more money for a deposit during lockdown as home movers generally, a survey has found.
Less than one in five (17%) first-time buyers said the lockdowns had enabled them to save more money for a deposit, according to the report from Santander
This compared with 31% of all buyer types, according to the survey of 2,000 UK adults who have bought a property since March 2020 or are planning to buy.
Younger buyers have felt the effects of unemployment and reduced incomes particularly harshly during Covid-19, while many also grapple with the cost of renting, Santander said.
The proportion of first-time buyers who said raising a deposit is the biggest barrier to home ownership increased from 30% in 2019 to 52% in 2021, the report found.
With house prices having hit record highs in recent months, a third (33%) of first-time buyers said that finding an affordable property in their preferred area is a barrier to ownership – three times the 11% who felt this way in 2019.
And after the coronavirus pandemic has hit many people’s incomes, more than half (54%) of people believe that financial support for first-time buyers from parents will now be less readily available.
Estimates have suggested that, on average, the bank of mum and dad typically provides more than £18,000 of financial support to a first-time buyer.
The study also found that more than two-fifths (44%) of first-time buyers delayed their plans to buy a home last year.
Over one in 10 (13%) first-time buyers said they had delayed plans to move home while there was uncertainty on what their future remote working policy might be.
However, nearly two-thirds (63%) believe home ownership is more important now than before the pandemic.
Santander is among several banks to have joined the UK Government’s recently launched 5% deposit mortgage guarantee scheme.
More than half (59%) of UK adults said the Government should give first-time buyers more support to address a growing gap between them and existing home owners in the aftermath of the pandemic, Santander said.
Tracie Pearce, chief customer officer for homes at Santander, said: “The impact of the pandemic on the housing market has been significant with many people reassessing what they want from their homes and making the most of a booming market and Government support with stamp duty.
“However, many younger people looking to take their first step on the property ladder have seen their earnings and job prospects hit hard, impacting their dreams of home ownership.”