‘Ideal time’ to be a first-time buyer as properties sell for UNDER the asking price and mortgage rates drop

MORTGAGE brokers say now is an “ideal time” for first-time buyers if they want to get on the housing ladder - but they’ll have to move fast.

Despite chaos in the markets right now, first-time buyers are actually set to benefit from the turmoil caused by Donald Trump’s tariff announcements.

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Plus, they may also be able to get better deals for the time being thanks to the end of the stamp duty holiday.

Ben Perks, managing director at Orchard Financial Advisers, told The Sun that “current conditions are cracking for first-time buyers”.

“Many vendors are crying out for a good first-time buyer to come along, so there could be deals to be done,” he said.

“Interest rates are getting better and lenders are really keen to lend, plus mortgages are becoming friendlier with more support for low deposits to entice first-time buyers.”

This week major lenders began slashing mortgage rates, with two offering deals below the 4% mark.

Coventry Building Society first launched mortgage rates of 3.89% for two-year fixed terms, and it was quickly followed by “big six” lender Barclays offering 3.99% on two, three and five-year deals.

Others including TSB, MPowered Mortgages, Gen H, Clydesdale Bank and Metro Bank also cut rates.

The moves appeared to come in response to the US president imposing huge tariffs on dozens of countries this week, which caused turmoil in the stock markets and fears of economic uncertainty.

Because economists now fear an economic downturn, that means the Bank of England is more likely to cut its base rate to offset this.

The base rate helps to influence the rates set by mortgage lenders.

After the tariff announcement, markets began pricing in four base rate cuts this year rather than four - which would likely mean lower interest rates being offered by mortgage lenders.

There is now some uncertainty around where mortgage rates will go after Mr Trump this week announced a 90-day pause on the tariffs.

Coventry Building Society has now pulled its market-leading rate, although it confirmed to The Sun the deal will still be available until Tuesday so people can get their applications in before then.

Even so, brokers still believe now is a great time for those looking to get on the property ladder.

Pete Mugleston, mortgage advisor and managing director at Online Mortgage Advisor, said if the base rate is cut when the Bank of England makes its next decision in early May then “this could be the ideal time for first-time buyers to look at the property market”.

Aside from dropping mortgage rates, first-time buyers can also benefit from a market slowdown caused by the end of the stamp duty holiday.

Stamp Duty Land Tax must be paid on properties worth above a certain threshold in England and Northern Ireland.

From April 1 this threshold reduced from £425,000 to £300,000 for first-time buyers, and from £250,000 to £125,000 for home movers.

This might sound like bad news for home buyers, but Mr Mugleston explained: “With the threshold for first-time buyers now at £300,000 and the average house price around £223,000 outside of London, most people won't be affected by the changes.

“While the changes might put off buy-to-let or second-home buyers, this could free up more properties for first-time buyers, giving them a larger pick of the market.”

Of course, this does mean those outside of London and the South East are more likely to benefit as homes are cheaper outside of these areas.

Alex Greaves, buying agent at Ridgestone Property, said that it’s still a “buyer’s market” in most locations.

This means home buyers should be able to negotiate more money off listing prices as well as better purchase terms.

Meanwhile Ross Lacey, director and independent financial adviser at Fairfew Financial Management, said he is seeing more properties sold at below the advertised listing price.

With so much uncertainty, though, buyers might want to move fast.

Harry Goodliffe, director at HTG Mortgages, said you shouldn’t expect this window of opportunity to stick around for too long.

“Some lenders are already creeping rates back up. It’s not a forever opportunity - if you're ready, now’s the moment. If you wait, you might miss it,” he said.

If you’re looking to buy, a number of lenders have recently introduced schemes aimed at helping first time buyers.

This week Barclays announced a new £0 deposit mortgage for Right to Buy home loans.

It means those hoping to buy their council or housing association homes under the Government scheme won’t need to stump up a deposit.

Until now, the bank had required at least a 5% deposit.

David Hollingworth, associate director at L&C Mortgages, said other helpful schemes include Yorkshire Building Society’s £5,000 deposit mortgage and the Skipton Track Record mortgage that can offer up to 100% loan-to-value.

He also pointed out that Nationwide this week tweaked its policy to improve eligibility for its Helping Hand scheme, which can offer borrowing up to six times a buyer’s income.