Pros & cons of being a 50+ first-time buyer

When we think of first-time buyers, we often think of young couples and fresh-faced professionals picking up the keys to their first home but recent research shows the reality can be very different.  

Analysis of data held by the Financial Conduct Authority shows there has been notable growth in the number of first-time buyers who are aged 50 and over. In contrast, the number of novice purchasers under the age of 30 is in decline.  

In fact, every region in the UK has seen the proportion of first-time buyers who are 50 or older grow. The strongest increases were seen in London (total number of 50+ years first-time buyers increased 63.7% between 2018 and 2022), followed by Northern Ireland (58.2%), the East of England (46.6%), the South East (36.3%) and Yorkshire & the Humber (35.4%). Wales saw older first-time buyer numbers increase by 23%, while the figure in Scotland was 7.6%.  

If projections using historic trends are true, 1 in 4 first-time buyers will be over 40 by 2030, while 1 in 20 will be over 50. Whether you have been busy saving for the biggest deposit possible, enjoyed the flexibility of renting, have been living with family or have had a change in circumstances, more people than ever are finding they’re a more mature first time buyer.   

Here are some of the pros and cons of being older than the average first-time buyer, which Statista says is currently 32 years old.  

Pros

• May have worked their way up the career ladder, earning the type of salary that lenders need to make the mortgage viable
• May have paid off debts, with the borrower having more disposable income to put towards mortgage repayments
• May have a better understanding of how lending and finance works, allowing them to have financially planned for a property purchase and retirement
• May have contributed to a pension or amassed savings, which can be used as a repayment asset should the borrower retire during the mortgage term
• May have saved enough for a substantial deposit, which can lead to a shorter mortgage term that dovetails with the borrower’s retirement age 

Cons

• May need to come out of retirement and take a job to build a deposit, cover moving fees and meet the lending criteria
• May find there is less choice of home loans, with higher mortgage rates and more restrictions
• May find they need a young guarantor to reassure the lender 
• May feel the pressure to take out a mortgage with a shorter term and higher monthly repayments, something that may not be affordable in the long term
• May have to work beyond the retirement age to afford repayments, which may hamper living standards, lifestyles and care plans
• May need proof of savings, pensions and other assets as the lender will want a guarantee that the borrower can make repayments after retirement age
• May have fewer years to see a property’s price appreciate, which isn’t a good strategy if the borrower is hoping to fund late retirement with property equity
• May be rejected by a lender if they have debts, as an over 50’s credit score and history will be taken into account during the application. 

If you’d like to talk over the prospect of becoming an older first-time buyer, get in touch.