The latest data from Legal & General’s Ignite platform shows that improved mortgage affordability and lower interest rates are tempting prospective buyers to purchase their first home.

Searches by brokers on behalf of first-time buyers grew 9.1% in September, following a 5.4% increase in the previous month.

This positive growth in activity shows that lower mortgage rates and improved affordability are encouraging first-time buyers into the market. Average rates on five-year fixed mortgages are hovering around 4.5%, and, according to the latest figures from the Bank of England, mortgage approvals have risen to their highest level in two years, with 64,900 approvals in August.

Overall, the market appears to be on an upward trajectory, with improved activity as we move into Q4 and early 2025.

Searches for ‘maximum age’ increased by 19.8%, while searches for ‘Maximum Loan Term’ surged by 27.9% in September. Despite sometimes needing to save longer for a deposit, buyers are committed to homeownership and are exploring longer mortgage terms to make buying a property more affordable.  

Earlier this year, Legal & General Ignite revealed that there was a 13% increase in 56-65-year-olds searching for their first property in Q1 2024, and September’s statistics indicate that this trend is continuing.

While affordability is a primary concern for buyers, environmental factors and the drive to save on energy bills are still playing a key role in their home buying decisions. Searches for ‘EPC rating’ increased by 53.5% in September, highlighting the growing interest in green and EPC related mortgages.

This rise may also be linked to the 10% increase in the energy price cap which came into force on October 1. According to recent data from the Mortgage Advice Bureau, 61% of prospective buyers are more likely to make an offer on a property with a good EPC rating. As a result, buyers may be paying closer attention to properties’ energy ratings as they become more mindful of potential energy costs and seek to minimise future expenses.

Kevin Roberts, managing director of Legal & General Mortgage Services, comments: “While there is still pent-up demand in the mortgage market, September’s results suggest that some of the activity is starting to kick into gear, providing a positive outlook for the remainder of 2024, going into early 2025. It’s great to see first-time buyer activity increasing as rates come down and affordability improves. And while affordability issues do remain overall, it’s encouraging to see that buyers aren’t being deterred by the possibility of having to save longer to afford the home of their dreams.

“While activity looks set to increase towards the end of the year, it’s vitally important that brokers have the tech tools they need to find the most suitable products for their clients. At Legal & General, we continue to invest in our technology, talent, and processes to help streamline and optimise decision-making for our valued broker and lender partners.”