First-time buyers prefer mutuals to banks when it comes to choosing their mortgages.
A new UK-wide survey of first-time buyers’ views by Coventry Building Society showed nearly 29% would initially approach a building society, with just 18.5% indicating they would approach a bank. The internet also scored well with 27.9% of respondents choosing it as first port of call. However 8% said they would turn to their parents first.
Younger buyers are also more spontaneous than older buyers. 27% of under 24-year-olds said that they would purchase the first property if they liked it, reducing to 12% for the over 55s.
Rob Clifford, managing director of network mortgageforce, said: ‘Regardless of initial preference, it is unusual to find clients that would let being pro-mutual override other factors of a product, such as price. This was not always the case, loyalty to mutuals was common five or six years ago. Some buyers do prefer building societies in the chance of a windfall, but increasingly societies are siphoning intermediary business into non member businesses.’
Although nearly 75% of respondents indicated that they would save up for a deposit, a further 11% indicated that they would borrow this. Some 7% of respondents hoped that their parents would provide a deposit for them.
Mark Murphy, general manager, marketing at Coventry, noted: ‘Our survey set out to examine attitudes of first-time buyers to the financing of their first home purchase. In spite of evidence from the market place that lending income multiples are being relaxed it is reassuring to see that nearly three quarters of respondents recognise that they must save up for and make a contribution to buying their own home.’
l See BSA Conference news p. 8