New Freedom of Information (FOI) data from the FCA gathered and analysed by financial adviser Quilter, suggests Labour’s ‘Freedom to Buy’ mortgage guarantee scheme will not provide the necessary impact prospective first time buyers need.

Quilter points to data showing that since its launch in April 2021, just 44,368 mortgages have been completed with the support of the current mortgage guarantee scheme – 86% of which, or 38,323 were first time buyers.

Comparatively, Quilter’s analysis of the new FOI data reveals that between 2021-2023, more than 1.13 million mortgages were secured by 18-30 year olds.

Quilter’s analysis reveals the number of people between the ages of 18 and 30 securing a mortgage each year has risen relatively steadily in the last decade, reaching 350,092 in 2023 compared to 252,558 in 2014.

However, this number has been trending downwards since a spike of 401,665 in 2021 which aligned with the stamp duty holiday introduced during the pandemic, resulting in a 13% fall in just two years.

Given mortgage rates and house prices are now much higher than a decade ago, which has piled pressure on affordability, prospective first time buyers are having a much tougher time securing a mortgage. Quilter stresses therefore that it is imperative that any schemes introduced by the new Labour government are effective.

In its manifesto, Labour pledged to introduce a ‘Freedom to Buy’ mortgage guarantee scheme, which would see the current mortgage guarantee scheme introduced by the Conservative party made permanent.

Though well meaning, Quilter believes the current scheme has had very little impact, meaning its permanence would provide inadequate support to its intended beneficiaries.

Commenting on the latest analysis Quilter mortgage expert Charlotte Nixon said: “While it is certainly a good thing that more young people have been able secure a mortgage over the past decade, it appears the number may now be falling. This will in part be down to the lack of support on offer for first time buyers, which has only been exacerbated by high mortgage rates, the pace of house price growth and the difficulty faced in saving a deposit.

She added: ““Not only have very few people made use of the scheme currently on offer, but with house prices still at risk of fluctuating, those that do could be at risk of negative equity. Having such a low deposit amount would leave people with little to no wiggle room in terms of house price changes before falling into what can be an extremely difficult situation to get back out of.”