New proprietary mortgage data from Barclays Property Insights revealsan increase in popularity of 30+ year mortgage terms. 

Among first-time buyers, these account for 41.3 per cent of purchases, as they are typically younger and so have longer to pay back a mortgage.

When asked about their preferences, nearly four in 10 (37 per cent) mortgage holders feel 30-40-year terms are more desirable than shorter durations because they could mean lower monthly repayments. This comes as four in 10 homeowners (41 per cent) believe their mortgage payments take up too much of their monthly income. On average, homeowners report their mortgage accounts for 27.7 per cent of their take-home pay, up from 26.6 per cent in July.

However, over half of those with a mortgage (53 per cent) are wary of extending their loan duration, as it would make them feel financially vulnerable later in life, with Millennials, feeling this most strongly at 60 per cent.

Mortgage and rent spending grew 4.4 per cent year-on-year in August, down from 5.2 per cent in July, following the Bank of England’s base rate reduction. Though confidence in the housing market tipped back up slightly to 29 per cent, monthly outgoings remain front of mind, with 60 per cent concerned about rising mortgage and rental costs.

Encouragingly, a fifth (22 per cent) of renters believe homeownership is achievable within five years, up from 16 per cent last month and the highest level since February. However, amidst reports of record high house prices, nearly half (47 per cent) cite this as a major barrier to ownership, up from 38 per cent in July.

Meanwhile, three-fifths (61 per cent) of renters have seen or expect to see their housing costs increase this year, squeezing their ability to save. To manage expenses, 40 per cent are reviewing their budgets, 43 per cent are cutting back on small luxuries, and 27 per cent are reducing holiday spending.

Barclays’ mortgage data also shows that three-bedroom homes are the most popular choice for properties, making up 46 per cent of all purchases in August. Millennial homeowners, age 28 to 43, are the most likely age-group to prioritise extra space – over a fifth (22 per cent) say they bought a property with more bedrooms than they currently need, to avoid upsizing later. This compares to just 13 per cent across all ages.

First-time buyers are increasingly turning to houses, with semi-detached properties making up over a third (33.5 per cent) of August’s first-time purchases, up 1.7 per cent year-on-year. Meanwhile flats declined in popularity by 2.7 per cent, accounting for a fifth (19.6 per cent) of first-time buyer homes.

A third (33 per cent) of recent Gen Z buyers, aged 18 to 27, said they bought a ‘forever home’ so that they wouldn’t have to move. Similarly, nearly three in 10 (27 per cent) of all recent buyers said they intend to stay in their new home for at least 10 years.

When choosing a property, certain features are more highly sought after by those in different life stages. Nearly half (49 per cent) of Gen X, aged 44 to 59, and 40 per cent of Millennial homeowners said they prioritised having a garden or outdoor space. Comparatively, only a third (32 per cent) of Gen Z felt the same. Meanwhile, Gen Z were much more likely to want a dedicated work from home space (28 per cent) compared to 20 per cent of Millennials and just 9 per cent of Gen X.