With record-breaking numbers of homes coming on to the market, how can first time buyers take advantage of an abundance of choice while navigating a difficult climate? Kay Hill has some tips
It’s an irony that won’t be lost on any first time buyer, that at the very moment the market was flooded with property for sale, so the flow of affordable finance suddenly dried up. Hot on the heals of a report from Zoopla at the end of February reporting the most homes coming on to the market in that month in a decade, came chaos in the Middle East – and in the mortgage market. In the space of 48 hours following the outbreak of war, nearly 500 mortgage deals were pulled, with 1,500 products disappearing in a matter of weeks and the average two-year fixed rate jumping from 4.83% at the start of March to 5.84% at the end of the month, according to Moneyfacts. At one point, the chaos was so bad that TSB raised mortgage rates twice in just 24 hours. Although the situation has stabilised slightly, the Bank of England’s subsequent decision to hold the base rate rather than the anticipated drop, along with continuing volatility in the mortgage market, might make first time buyers cautious about entering the fray. However, the fact remains that there is a lot of good value property on the market, and this could be the moment to grab a bargain.
Stricter regulation for landlords had already led to the private rental sector decreasing in value by £48bn in 2025, according to Savills, and the arrival of the Renters’ Rights Act in May has prompted even more landlords to put their rentals up for sale – offering great opportunities for first time buyers. Head of Residential Research at Savills, Lucian Cook, says, “We’ve grown accustomed to a story of the private rented sector expanding at the expense of people’s ability to get on to the housing ladder. But while deep-seated housing challenges remain, lighter regulation in the mortgage market and tighter oversight of the private rented sector are gradually beginning to shift that narrative.”
So how can buyers take advantage of the situation? Well firstly, as you don’t have a property to sell you are going to be attractive to buyers, especially exiting landlords. “Sellers are looking to sell their property as efficiently as possible, and chain-free buyers can reduce delays as they don’t have an existing property to sell,” says Karl McArdle, Co-Founder of The Property Buying Company. “Highlighting this position can help you to stand out as a more reliable purchaser than those who are waiting for their own property to be purchased,”
You must, however, be ready financially – so it’s more important than ever to have your paperwork sorted, your deposit funds accessible and a Mortgage in Principle in place. And in such a turbulent mortgage market, a broker can be your best friend. “Between the chaotic rate of change in the mortgage market, and continued house price volatility, it’s not easy for would-be homebuyers at the moment,” says Chris Storey, Chief Commercial Officer at Atom Bank. “For brokers and borrowers, now is the time to prioritise working with lenders who can move quickly, providing reassurance and easing some of that stress. In such fast-moving volatile times, brokers have a crucial role to play in bringing some calm, and the right partnerships can help them do just that.”
Another advantage of the current climate is that you may be able to haggle, notes Karl McArdle. “Research the area to see if there are any other new properties under construction, as rival developers will be competing for sales. Developers want a quick sale, so they may be willing to accept a lower offer than the listed asking price. If your offer is turned down, it’s always worth negotiating on things like the cost of fitted appliances.” While it’s rare that developers will drop much on asking price, many will offer incentives ranging from money towards your deposit to upgrades on fittings or floorcoverings.
Home-movers and exiting landlords are far more likely to accept a lower price offer – especially if your survey has thrown up any defects – however, McArdle adds, it’s important to stay focused. “Negotiating on the property price will mean back and forth with the seller, as they put in their counter-offers. To secure a price you are happy and comfortable with, it’s important to set a budget in advance to ensure that you do not go over it in the moment. You need to be willing to walk away from a deal so that you do not overextend yourself or offer too much in a bidding process.”
Caution is also appropriate when it comes to mortgages – a variable rate is risky in such a volatile climate, and while a three or five-year fix will cost slightly more than a two-year fix, it gives more time for the current crisis to resolve and offers longer term security. Mortgage companies are also likely to be more cautious in their lending, so maximising your deposit and ensuring your credit rating is the best it can be will help to tip the scales in your favour.
While the increases in mortgage rates have been an unexpected shock to many would-be buyers, those who are still ready and able to buy may find they are compensated by a better choice of property and more opportunities to secure a discount. Richard Donnell, Executive Director at Zoopla, says, “The market remains active, but becoming increasingly reliant on a smaller pool of serious buyers. Some early stage buyers are adopting a wait and see approach but there is a sizable group of committed buyers who are pressing ahead with housing purchases. For buyers, there is less competition and more choice, but affordability is becoming more stretched.”
Kay Hill
Kay has been a professional journalist since her teens, working for local and regional newspapers, magazines and now websites as well. Kay work across a number of fields, including architecture, design, personal finance and the housing market – Kay enjoys making the complicated things in life a little easier to understand.As a consultant for PR company Building Relations, Kay has written for developers including Barratt London, Dandara, MTVH and Annington.
Kay enjoys the beauty of language, the structure of grammar and the process of condensing thousands of words of research and interviews into 1,200 carefully chosen words that will leave the reader a little more informed than when they started.
