Data reveals 10% increase in searches
There has been a significant increase in borrowers turning to the so-called ‘Bank of Family’ for financial assistance, the latest data from mortgage research and sourcing platform Legal & General Ignite has revealed.
In November, there was a 9% month-on-month rise in searches for first-time buyer products, following a robust 13% increase in October.
As the demand for first-time buyer products remains strong, Legal & General Ignite noted that another trend has emerged — a 10% increase in searches for products accepting gifted deposits. The reliance on family support is further evident with a 12% jump in searches for gifted equity and concessionary purchases in November.
Earlier forecasts from Legal & General and the Centre for Economics and Business Research estimated that family support would aid 318,400 housing transactions in 2023. This marks the highest level of family-backed property purchases since tracking began in 2016.
Despite economic uncertainties and the challenges posed by the cost-of-living crisis, market demand remains resilient, registering a 1% increase in total searches from October to November. ‘Capital Raising’ has become the third most popular search criteria, witnessing a significant 16% increase since September.
Legal & General Ignite’s data also shed light on emerging trends among portfolio landlords. Searches related to ‘second residential property’ saw substantial 29% growth, while brokers exploring house in multiple occupation products increased by just under 20%. This reflects a growing interest in diverse property types within the portfolio landlord segment, with holiday let and Airbnb searches also seeing a slight uptick.
Affordability remains a paramount concern for borrowers despite overall market resilience. While searches for products catering to those who had previously missed mortgage payments decreased by 15%, they still remain high, underscoring the persistent impact of the rising cost-of-living. Searches for ‘default unsatisfied’ increased by 6%, highlighting a broader market issue of homebuyers seeking to clear debts before applying for mortgages.
“As the property market continues to evolve, it’s clear that first-time buyers are driving significant momentum, seeking support from the Bank of Family to navigate affordability challenges,” Kevin Roberts (pictured), managing director at Legal & General Mortgage Services, commented. “The data from Legal & General Ignite also highlights the resilience of the overall mortgage market, with diverse trends among portfolio landlords and a sustained interest in capital raising, even during these uncertain times.
“Affordability does remain a persistent concern though, reflected in the notable level of defaults and missed mortgage payments, as well as the continued reliance of first-time buyers on the support of family and friends. It is important that all borrowers, no matter their circumstances, seek the guidance of an expert adviser, to ensure they are taking the optimum path in what remains a fast-moving and complex market.”
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