The first-time buyer market has undergone a fundamental shift in the past decade.

Once a beleaguered demographic, particularly in London and the south-east, they are now the largest group of property purchasers, according to our research.[1]

This is set to continue for the foreseeable future, and certainly into 2023 – in line with the anticipated withdrawal of Help to Buy.

Without doubt, first-time buyer buoyancy creates an opportunity for agents, and by adapting their offer and recalibrating their marketing strategies, there is great scope to engage this pool of aspiring purchasers.

Historically, the housing market has been dominated by existing home-owners – typically trading up or down the ladder, but there has been a paradigm shift over recent years.

Indeed, FTBs have emerged as the driving force behind overall housing sales volumes, bolstered by low mortgage rates and government incentives such as Help to Buy; meanwhile, we’ve witnessed a decline in market share amongst existing mortgage borrowers.

FTBs are new to the buying process, and agents have a key role to play in supporting the transition from renting or living with family, to buying and eventually becoming a first-time seller.

Forming a bond with FTBs has the potential to last years and through multiple transactions.

Affordability and house prices

Regardless of growing affordability pressures, FTB numbers are up 85% since 2010 according to UK Finance, rising faster than other buyer groups.[2]

Furthermore, outside London and the south-east, where homes are, on average, more affordable, there is strong potential for further FTB growth over the next 18 months.

Despite their recent proliferation, research by Santander indicates that FTBs are surprisingly ill-informed about the buying process and its associated jargon.[3]

There is great potential here for estate agents to demystify the buying process, and impart their knowledge and expertise – for example, by hosting one-to-one or group information sessions about key topics such as mortgages, Help to Buy and housing surveys.

Zoopla too is adapting its business to reach this weighty pool of house hunters effectively, and is creating tools and insights that cut through the noise.

Earlier this year, we published a ‘Property Jargon Buster’, providing an A-Z breakdown of valuable vocab.

More recently, our product team has been building easy-to-use tools that simplify the time-consuming and often confusing calculations associated with Help to Buy. Watch this space for more news later in the year.

Zoopla’s ‘Mortgage in Principle’ is another useful tool to aid understanding around affordability.

The tool is hosted online and takes five minutes to fill out, for maximum ease and efficiency.

Affordability and mortgages

Improved mortgage availability has also boosted FTB numbers. Crucial to this is the Bank of Mum and Dad (BOMAD) – officially the tenth biggest mortgage lender in the UK, according to Legal & General.[4]

While some have benefited from the early release of inheritance, we’ve also recorded an increase in the number of households releasing equity from their homes, liquidating assets to help children or grandchildren take their first steps onto the property ladder.

The same survey reported that 16% of home-owning adults in the UK have used, or would use, equity release from their own home to help their loved ones afford their own, making it the third most popular source of funds for the BOMAD.

A long-term view

While many FTBs were once resigned to shoebox-sized starter flats, the arrival of government initiatives has enhanced powers of affordability and enabled many to purchase a much larger property – often a three-bedroom semi-detached house, which might once have been the preserve of a second-stepper or growing family.

Without doubt, helping FTBs as they navigate the buying process is almost sure to guarantee repeat custom when it comes to their next move.

Feedback also shows that they’re far more likely to recommend an agent who has supported them through the tribulations of their first buy – a real source of potential when we’re reminded of the influence that FTBs are exerting on the market at this time.

Lest we forget, the FTB of today is tech savvy and often a subscriber to social media and online reviews.

The most successful agents will ensure that their finger is on the digital pulse and will adapt their marketing strategies and customer engagement approach accordingly.

* Charlie Bryant is CEO of Zoopla

[1] Zoopla, September 2019, ‘Can first time buyer numbers keep on rising?’.

[2] ibid

[3] Santander, September 2019, ‘Santander launches national branch events to stop first-time buyer misconceptions derailing homeownership dream’.

[4] Legal & General, August 2019, ‘Bank of Mum and Dad’.