In the week the Bank of England will announce whether or not it plans to make changes to the Bank Rate, research from Yorkshire Building Society shows only 8% of potential homeowners aged 18-40 say speculation about a rate rise is hindering their house buying plans.
The Yorkshire’s First Time Buyers report found just one in 12 young people saw changes to interest rates as a barrier to owning their own home, compared to 44% of respondents blaming high deposits as a reason preventing them from buying and 33% concerned about the cost of property in their local area.
The Yorkshire Building Society Group, which includes intermediary-only lender Accord Mortgages, has seen a surge in the number of borrowers seeking fixed rate mortgages over the last three months.
The ratio of fixed rate to variable rate mortgage applications received by the mutual has grown from 35:1 in August to 64:1 in October, despite the Yorkshire currently offering the lowest ever mortgage rate, a two-year discounted standard variable rate (SVR) with an interest rate currently of 0.87%.
Mike Sims, senior mortgage manager at Yorkshire Building Society, said: “Our research shows that despite general uncertainty about Bank Rate rises and other challenges first-time buyers face, those looking to buy their first house are not being deterred.
“The mortgage market has been in unchartered territory for many years now and even with the prospect of rates rising it’s pleasing to see that many aspiring homeowners still believe owning their own home is in reach.”
Findings from the Yorkshire’s report demonstrate how young adults remain optimistic about the prospect of owning a property, with 65% believing it was likely or very likely that they would become homeowners, and 56% revealing they are currently saving money to buy their own home.
The majority of those surveyed also believe owning a home would be good for their future prospects, with 83% saying they thought it would be a good financial investment.