Cost of property is single biggest challenge highlighted by first time buyers

Research commissioned by Bank of Ireland has shown that first time buyers are ready to travel longer distances from their home to work, with one in four (28%) prepared to commute over 30km (up from 18% in April 2017). More than half (53%) of those surveyed cited the cost of property as the single biggest challenge facing them, followed by the ability to save a deposit (22%) and lack of supply in the areas they would like to buy (17%).

Continued growth in property prices in Dublin means first time buyers are increasingly looking outside the capital to purchase property. The research, conducted by RED C, shows that those hoping to buy in Dublin declined to one in four (28%), from one in three (35%) last April.

With average monthly rent of €779 being paid by respondents, and most (78%) planning to buy with a partner, the vast majority (91%) said that they are confident they can afford monthly mortgage repayments. Three in four (75%) are confident that they can make mortgage repayments should interest rates increase significantly. Four in five (82%) first time buyers have a savings plan, with one in three (32%) saving between two and four years. The average amount being saved is €461 per month, up from €444 in April 2017.

Other findings in the first time buyer research included:

95% of respondents said that they would prefer a house over an apartment
One in four (27%) respondents would prefer to build their own home (up from 16% last April)
Six in ten (61%) are aware of the tax incentives for newly built homes
Three quarters (74%) of first time buyers are currently renting

Discussing the research, Shane Quinlan, Head of Mortgages, Bank of Ireland, said “There is much to consider for first time buyers when navigating the current property market. While affordability of mortgage repayments doesn’t appear to be a major issue, and most have a savings plan in place, the cost of property and ability to save the required deposit is still a concern. Housing supply and pricing issues are clearly driving interest away from Dublin, with more first time buyers prepared to travel longer distances.

“We continue to see momentum in the mortgage market this year with strong demand from the first time buyer segment in terms of drawdowns and we are focused on developing propositions to help our mortgage customers at all stages of their homebuying journey.”

In order to support first time buyers on their journey, Bank of Ireland has launched a new online First Time Buyer’s Guide. The Guide takes prospective home owners through the entire process, from deciding to buy and saving for the deposit, to putting the finishing touches to their new property.