United Kingdom First Time Buyers Consumer Market Report 2021
Dublin, Oct. 28, 2021 (GLOBE NEWSWIRE) -- The "First Time Buyers Consumer Research Report 2021" report has been added to ResearchAndMarkets.com's offering.
This report traces the 'customer journey' of consumers when they purchase their first home and take out a mortgage. It considers who FTBs are and the differences between the main types, the types of journeys undertaken (online/office, professionally supported/independent etc.) and considers the pinch points along the process and satisfaction with the overall journey. It finally discusses what happens when the journey is over and the journey taker becomes a customer.
67% of first-time buyers (FTBs) who purchased their homes during the COVID years of 2020 and 2021 were impacted by COVID.
Its key impacts on FTBs were:
It generally reduced activity. It was more likely to cause a purchase to be postponed rather than bring a purchase forward. It appears COVID's negative effects were more pronounced at the start of the pandemic in 2020 rather than in 2021, when lockdowns began to ease.
It changed the demand for professional support. 2020, the year the pandemic first hit the UK, saw a dramatic shift in FTB attitudes towards getting professional help. Given the uncertainty in the market, the removal of face-to-face contacts between mortgage providers and customers and the withdrawal of many higher loan-to-value mortgages from the market, many FTBs shifted their priorities towards getting professional help when arranging a mortgage. In 2021, in contrast, as the market settled into the new ways of working and lockdowns began to ease, FTBs shifted back to a more self-reliant approach to arranging mortgages, with independent journeys growing in relative importance.
It encouraged a Switched On journey. FTBs embarking on a journey in 2021 are much more likely to have had an online-switched on journey compared with those taking a journey in earlier years, with COVID clearly having an important influence on this.
COVID appears to have lowered the dependence on mortgages. Comparing FTBs impacted by COVID to all of those that purchased in 2020 and 2021, indicates that those impacted by COVID tended to rely less on mortgages to pay for their homes compared with those not impacted. This could be because during COVID high LTV mortgages were withdrawn, meaning the market shifted towards more affluent FTBs who rely less on mortgages when buying.
It made customer journeys harder to navigate. Journey takers impacted by COVID and more generally all FTBs taking a journey in 2020 and 2021, found the journey harder, compared with those taking journeys in 2018/2019.
COVID inspired customer-provider communications. Customers impacted by COVID are much more likely to have initiated contact with their mortgage provider over the past year compare with those not impacted. These FTBs were also more likely to have received communication from their mortgage providers. While 66% of FTBs impacted by COVID contacted their mortgage provider in the past year, only 23% of those not impacted by COVID did likewise.
These and other findings about the nature, shape and types of journeys undertaken by First Time Buyer mortgage customers are discussed in the Report First Time Buyers Customer Journey 2021.
Three types of first-time buyer (FTB) are considered:
Those who have purchased their first homes since 2018: Completed Journey FTBs
Future FTBs:
Those who are currently engaged in the home buying process but have yet to complete: Journey In Progress FTBs
Those who have not yet started a journey but have definite plans to do so over the coming year or so: Journey Not Started FTBs
Key Topics Covered:
1. EXECUTIVE SUMMARY
Completed Journey FTBs get ahead of the game
Guarantor mortgages very popular with FTBs
FTBs prefer a supported journey
Almost half of FTBs have a Switched On Journey
FTBs buy with LTVs of around 55%
Eight-in-ten FTBs use Government Support Schemes
A largely smooth journey
Future FTBs need lots of hand holding
High levels of Post journey provider-FTB communications
A dynamic market
COVID re-shapes the customer Journey
2. INTRODUCTION
Methodology
The stages of the mortgage process
3. WHO ARE THE FIRST TIME BUYERS?
Completed Journey takers get ahead of the game because they are more affluent
Guarantor mortgages very popular with FTBs
Older FTBs and those buying recently the most likely to have repayment mortgages
Fixed rate deals dominate
Terms lengthen during COVID
A COVID-19 pandemic journey?
Lloyds Banking Group the preferred mortgage provider
4. AN INDEPENDENT OR SUPPORTED JOURNEY
Future FTBs likely to need more support than they think
COVID results in more extremes of action
5. BRICKS VS. CLICKS JOURNEY
The typical journey moves from virtual to real
Big shift online for communication and arranging
Almost half of FTBs are Switched On
COVID, timing and affluence the main drivers of online actions
An FTB's journey may start with online resources but there remains a central role for brokers
FTBs prefer online means of communications with mortgage providers
COVID shifts communication further online
6. THE FINANCIAL CHARACTERISTICS OF THE JOURNEY
FTBs buy with LTVs of around 50%
The reliance on mortgages wanes
The typical FTB has a mortgage of around £140,000
Virtually all home buyers use a mortgage
Four-in-ten buyers get savings support from friends and relatives
Most FTBs buy with spouses or partners
Eight-in-ten FTBs use Government Support Schemes
The value of official support schemes will grow
7. IDENTIFYING THE PINCH POINTS
Four journeys
Being impacted by COVID makes the journey harder
An easier journey improves satisfaction
A better first contact and help with the legal and financial info can improve satisfaction
First and early contact an especially important area to focus on
Mortgage providers are getting key aspects of their services right
But there is always room for improvement
Future FTBs need lots of hand holding
Income and social grade key influences on confidence
8. POST JOURNEY: BEING A CUSTOMER
Most FTBs are not under financial stress after their purchase
Most FTBs receive provider initiated communications
Almost half of FTB customers initiate a conversation with their providers
COVID drives customer contacts
Most FTB initiated contacts end with a satisfied customer
The customer journey might be moving online, but the telephone remains crucial
FTB market can be fast moving
FTBs from the A social grade will be the main drivers of new business
For more information about this report visit https://www.researchandmarkets.com/r/14x2t1
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