The lender view
Rachel Geddes, strategic lender relationship director at Mortgage Advice Bureau, interviews Jeremy Duncombe, managing director of Accord Mortgages.
Geddes: How do you see ongoing lender innovation reshaping opportunities for first‑time buyers?
Duncombe: Since the withdrawal of Help to Buy, first-time buyers have found it significantly harder to access the housing market the way they once could. Whatever its drawbacks, the scheme served a clear purpose: it enabled larger numbers of first-time buyers to purchase homes affordably and gave housebuilders the confidence to deliver the right types of homes in the right locations.
Its removal coincided with a perfect storm for affordability — surging living costs, the fallout from the Truss mini‑Budget and a sharp rise in mortgage rates. The result has been reduced borrowing capacity, higher deposit requirements and fewer routes onto the ladder for aspiring homeowners.
Lenders have had to respond and innovate to address the twin challenges of affordability and raising a deposit. Our 5K Deposit Mortgage was designed specifically to tackle the deposit barrier for buyers who can sustain mortgage payments but struggle to amass a large upfront deposit, at a time when many were saving towards 10%, 15% or even 20% deposits.
By reducing that hurdle, the product does exactly what it says on the tin — allowing buyers to bring forward their homeownership journey by several years. This type of targeted innovation is critical if we are to rebuild momentum at the bottom of the market, and it’s encouraging to see other lenders exploring different ways to support first-time buyers.
Ultimately, first-time buyers are the lifeblood of the housing market. Enabling them to get on the ladder earlier supports market liquidity, boosts confidence and underpins long‑term housing delivery.
Geddes: What more needs to be done to maintain momentum among first‑time buyers in the current climate?
Duncombe: The key challenge — and opportunity — is restoring confidence among first‑time buyers. A significant cohort of prospective buyers has effectively self‑excluded from the market.
Many assume they cannot afford to buy, have been told mortgages are harder to obtain, or believe that a past credit blip or modest income rules them out altogether. As a result, they continue renting and, in many cases, disengage from the market for years.
Beyond brokers, there is also a broader role for the industry to communicate more positively about opportunities for first‑time buyers. This includes working with the media to highlight viable routes onto the ladder, and engaging with touchpoints where aspiring buyers already are — such as letting agents — to ensure the right messages reach renters who may not realise they are closer to buying than they think.
Geddes: Why do you believe it’s important that people who want to buy a home are able to do so, and what does homeownership represent in today’s market?
Duncombe: While homeownership has an aspirational element, it is ultimately about far more than that. It provides long‑term security, greater flexibility and the ability to build wealth through equity. Importantly, it also plays a crucial role in supporting financial resilience later in life. Our research has shown that homeowners are significantly better off in retirement than those who rent, highlighting a lifetime wealth gap of £2.6m for individuals forced to rent rather than buy.
There will always be people who choose to rent, but for many, accessing the housing ladder earlier can deliver substantial long‑term benefits by enabling them to build equity over time.
This is particularly important as borrowers approach later life; paying off a mortgage in their 50s or 60s can mean entering retirement without housing costs and with equity available to support future needs.
Geddes: What changes are needed to improve access to homeownership, and where should that change come from — lenders, government, or industry collaboration?
Duncombe: Addressing the challenges facing the housing market requires a joined‑up approach across the industry. It cannot be solved by any single stakeholder in isolation. Lenders can innovate and adapt, but they must operate within a regulatory framework, which means the regulator also has a key role to play, and it is encouraging to see the regulator engaging through consultations and signalling a clear ambition to support greater access to homeownership, while acknowledging some of the structural barriers that have existed.
Many of these measures were introduced for the right reasons following the credit crunch, when the market needed fundamental reform. However, nearly two decades on, the market has evolved significantly. Lenders are now better regulated, better capitalised and far more risk‑aware, yet many of the same constraints remain in place.
There is a case for allowing lenders greater discretion to make responsible lending decisions, while maintaining robust standards of prudence.
