Over a million UK adults are set to be in a financial position to buy their first home in the next 12 months, Pepper Money has revealed.

The firm’s latest Specialist Lending Study stated that this figure is set to increase to 4.5 million over the next three years.

Pepper Money's report, which surveyed 4,000 adults, suggested millennials are set to lead this charge, with 1.9 million expected to enter the housing market in the next three years, followed by 1.7 million Gen Z buyers.

Although the findings pointed towards strong ongoing demand for homeownership, the lender also reported an anxiety and confidence gap among the nation.

Over one in six (17%) adults described the mortgage process as a "daunting prospect", while almost one in 10 expressed concern that their application could be declined due to their credit score.

Of those adults expecting to be in a financial position to buy a house in the next three years, Pepper Money estimated that 2.2 million have missed a payment or entered a debt management plan.

Sales director at Pepper Money, Paul Adams, said: "It's sobering that nearly a fifth of UK adults find the mortgage process daunting, rising to over a quarter among those with adverse credit who aspire to buy a home.

"It reinforces the vital role brokers play, offering expert guidance, reassurance, and a personalised approach to help create positive and sustainable outcomes for borrowers with more complex financial situations.

"As financial lives become more varied, such as growing numbers of self-employed, and a broader picture of over 16 million UK adults who have now experienced adverse credit, brokers are uniquely positioned to guide consumers through the mortgage process with confidence."

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