More new buyers enter the market despite higher costs
The average cost for first-time buyers in the UK has risen to £229,000, marking a 2.4% increase compared to the previous year, according to recent analysis by property platform Zoopla. This growth outpaces the overall rise in UK house prices, which stands at 1.3%.
Improved mortgage affordability over the past six months has expanded borrowing capacity by 20% for those using a mortgage. This has contributed to a 30% rise in first-time buyer mortgage activity and has encouraged buyers to consider higher-value properties in regions where prices remain comparatively accessible.
First-time buyers continue to play a significant role in the housing market, accounting for 39% of all property sales annually and nearly half (49%) of all new home purchase mortgages. Data from Zoopla indicates that 45% of these buyers are seeking three-bedroom houses, while interest in flats has declined to 29%.
Regional differences in price growth are notable. In nine out of 11 UK regions, the price paid by first-time buyers is increasing more rapidly than the wider market. The North East has seen the sharpest rise, with first-time buyer prices up by 10.2% year-on-year, compared to a 2.4% increase for the broader market.
Scotland, Yorkshire & Humber, and the North West have also experienced stronger growth in first-time buyer prices relative to their regional averages.
In contrast, first-time buyers in London are opting for properties that are 2.4% less expensive than those purchased a year ago. This shift is partly attributed to the end of stamp duty reliefs in April, which has raised transaction costs in higher-priced areas.
Affordability remains a key consideration, with first-time buyers typically targeting homes priced 15% below the local average. In London and the South East, this gap widens to 21%, and in Wales to 17%, as buyers seek properties that align with their financial circumstances and mortgage eligibility, including stamp duty obligations.
“First-time buyers have had a 20% boost to affordability over the last six months,” said Richard Donnell (pictured right), executive director at Zoopla. “This is enabling them to look at buying higher value homes in the more affordable parts of the country which is supporting faster house price growth across the board.
“In contrast, first-time buyers in London and southern England are looking for cheaper homes than a year ago despite the extra borrowing capacity. The ending of stamp duty reliefs since April has added to the cost of buying a home for first-time buyers.
“Large deposits and mortgage regulations mean a high household income is needed to buy in southern England where affordability remains a challenge and this is acting as a drag on house price growth across southern England. The variation in affordability explains why first-time buyers across England are looking to buy three-bed houses while in London, one- and two-bed flats remain the primary target for those buying their first home.”
Meanwhile, separate research from home moving platform Compare My Move highlights a 59% year-on-year increase in first-time buyers entering the market during the summer of 2025.
Of over 12,000 buyers using the company’s conveyancing services in that period, 69% were first-time purchasers, up from 64% in the previous summer. This trend has resulted in first-time buyers comprising the majority of movers.
The firm’s data shows that across the entirety of 2025, 68% of buyers were purchasing their first home, compared to 66% in 2024. The most significant increase was observed during the summer months.
“The summer of 2025 has been far more politically stable than the same period in 2024, when the general election caused many potential buyers to delay moving or taking out mortgages due to uncertainty about the economy and housing market,” said Dave Sayce (pictured right), co-founder and managing director at Compare My Move.
“Since then, there’s been a strong push to make homeownership more affordable for first-time buyers, supported by a significant drop in the mortgage base rate from last year’s highs. The government has also introduced mortgage guarantee schemes, allowing buyers to secure mortgages with smaller deposits, and committed to building more new homes. These factors, combined with lower borrowing costs, have made it easier for first-time buyers to get onto the property ladder.
“Looking ahead, it’s likely that next summer will see even more first-time buyers entering the market. Especially with new reforms that the government are proposing, we are going to see a first-time buyer boom.”
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