Average first time buyer paying nearly £200 more a month than a year ago
First time buyers are paying an average of nearly £200 extra a month compared to a year ago, according to research from a UK property website.
As a result of higher asking prices and interest rates Rightmove has said first-time buyers with a 15% deposit now pay £1,056 a month compared to £865 a year ago.
Costs have come down, however, as the market turmoil that followed the Liz Truss government's September mini-budget subsided.
In October the average first time buyer paid £1,218 a month on their mortgage.
As a result of former chancellor Kwasi Kwarteng's budget of unfunded tax cuts and spending many lenders pulled mortgage products from the market while mortgage costs increased as interest rate forecasts rose.
Figures from Rightmove say the current average rate for a five-year fixed, 85% loan-to-value mortgage has fallen to 4.44%, down from 5.89% in October.
But it's still higher than the 2.76% rate for the same mortgage last year.
At the same time the average asking price for a first time buyer has risen to a record £224,963, Rightmove says.
Demand for first time homes is 11% higher than pre-pandemic, the company says, as a result of stabilising mortgage rates and a determination among buyers to get onto the ladder.
Average monthly mortgage payments for all home-movers are steadying, the figures show.
Someone purchasing an average property with a 15% deposit would now pay £1,720 a month, compared to £2,012 per month in October and £1,799 per month in January.
Head of mortgage products at Rightmove, Matt Smith, said: "The combination of a new record price and higher mortgage rates than last year means it is a challenge for first-time buyers.
"Our data indicates that first-time buyers who are able to raise their deposit are still finding buying compelling, with the number of people looking to move in this sector currently higher than the last more normal market of 2019."