According to Yorkshire Bank’s latest Housebuyers report, more than 80 per cent of first-time buyers are considering taking out a 25 year-plus home loan, while only 39 per cent would rule out a mortgage that was five times their income.
The report also reveals that three in ten new starters are so desperate to get onto the property ladder that they are prepared to make an instant offer that is above the asking price.
It follows a warning from the Royal Institution of Chartered Surveyors that first-time buyers are particularly vulnerable to further rises in interest rates, which would lead to unmanageable mortgage repayments.
Gary Lumby, from the bank, commented: “With the average house price nearing Â£200,000, this year may feel like the last chance saloon for first-time buyers already finding it hard to buy.
“Two rate rises last year did little to slow house prices and it looks unlikely this latest rise will have any significant impact either. Therefore, their fears are the longer they leave it to buy, the harder it will be.”