First-time buyers are persisting with Help to Buy purchases ahead of the 31 March cut-off-point, data from Legal & General’s SmartrFit tool has suggested.

Introduced in 2021 as a replacement for the original Help to Buy scheme, the Help to Buy Equity Loan Scheme is set to end at the end of the month.

The new scheme is only available to first-time buyers, which L&G suggested is reflected in its latest data. Criteria searches for Help to Buy increased by 10% in February. Whilst in the same month, First Time Buyer searches rose by 12%.

Head of mortgage products and transformation at L&G Technology, Jodie White, said: “The increased search results in the Help to Buy scheme show there is still strong demand for schemes which help first-time buyers take a step onto the property ladder.

“The Help to Buy scheme has been a vital tool in helping new homebuyers. As the last elements of the scheme come to an end, there is a real need for new technology-driven initiatives to support brokers and their first-time buyer clients.”
 
February’s data also highlighted how rising living costs are still impacting mortgage applicants. Searches for applicants with a second job increased by 19% while applicants with zero-hour contracts climbed by 43%.

L&G stated that these figures indicate the financial pressures of applicants in need of a higher income to make mortgage payments. Figures of missed mortgage payments rising by 14% and a 48% increase in payday loans also showed the direct impact of rising living costs on aspiring first-time buyers.

White added: “Advisers will be key to supporting this segment of the market, but they also have a key role to play for other customers, such as existing homeowners who need to remortgage. To do this effectively, they need access to the right tools and tech.

“The more that the industry can digitise the mortgage journey, and streamline processes, the better for clients and advisers alike. Indeed, everything from developing cutting edge product sourcing tools, to implementing digital ID and Open Banking are a welcome addition to speed up the homebuying journey and improve efficiency across the board.”

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