According to the Building Societies Association’s (BSA’s) latest property tracker, six in 10 first-time buyers said raising a deposit was the main barrier.
More than half said the cost of monthly mortgage repayments was the biggest obstacle.
Almost 47% said they believe not being able to borrow enough is a major barrier to buying a home. This is despite regulation changes that have allowed lenders more flexibility around affordability and stress testing.
Approximately a quarter said stamp duty tax was a barrier, which is up from 7% in 2022.
This comes as rumours circulate that stamp duty will be under scrutiny in the upcoming Budget, potentially being replaced with a property tax.
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There is also frustration with the complexity of the home buying process, with 14% seeing it as a serious barrier, up from 10% in July.
This coincides with the government looking into how to reform the home buying and selling process.
Only 17% of those surveyed said they thought it was a good time to be a buyer, which compares to a third who disagreed. This brings net confidence to a score of negative 16%.
While this is an improvement on the negative 21% recorded in the summer, it shows that confidence is still fragile.
Almost half of non-homeowners said they expected to be homeowners by now but are not.
Paul Broadhead, head of mortgage and housing policy at the BSA, said: “For too many people, the dream of owning a home has turned into a sense of defeat. The financial barriers are well-known, but it’s clear that policy uncertainty and the complexity of the process are now part of the problem too.
“Speculation about changes to property taxes may grab headlines, but it risks damaging confidence and creating unnecessary volatility. What buyers need most is stability, not stop-start interventions that distort the market.
“Building societies are working hard to support first-time buyers with flexible lending options and innovative mortgage offers. But lasting change requires a joined-up approach that focuses on housing supply, simplifies the buying process and creates the confidence that homeownership is achievable again. If we get that right, the future of the housing market can be a much brighter prospect for the next generation.”
