First-time buyers kept the market moving in 2025 - and 2026 must go further, faster, and fairer

This article was produced in partnership with Skipton Building Society

After a year of stubborn affordability challenges and a cooler macro backdrop, you might expect first-time buyer (FTB) activity to have stalled. Instead, 2025 underlined how central this group remains to the UK mortgage market — and how much is riding on the industry’s ability to support them more effectively heading into 2026.

At Skipton Building Society, FTBs were firmly centre stage: half of all new lending in 2025 went to first-time buyers, a clear sign of both resilient demand and the vital role brokers play.

“First‑time buyers really were the beating heart of UK mortgage activity this year,” says Jen Lloyd, Head of Products and Propositions - Homes. “It’s brokers who are translating that demand into keys‑in‑hand, often in extremely challenging affordability conditions.”

Affordability: the defining issue — and a growing regional divide

Affordability remains the single biggest barrier for aspiring homeowners, but 2025 highlighted how unevenly that barrier is felt across the UK.

The latest Skipton Group Home Affordability Index points to deepening regional differences: parts of Scotland continue to sit among the more affordable areas for FTBs, while some areas of Wales are now among the least affordable. That divergence demands more localised advice strategies, not a one‑size‑fits‑all affordability play book.

Brokers are increasingly recommending longer terms — up to 40 years — and, where appropriate, higher loan‑to‑income (LTI) multiples as pragmatic levers to make viable cases work without over‑stretching clients.

This data reinforces how tough the landscape has become. Many adults living with parents, often assumed to be in the best position to save, still cannot afford the average first-time buyer home in their local authority area based on their own finances, even when the deposit hurdle is removed. Income, not just deposit, is now the critical constraint.

“For brokers, these data points are more than headlines,” Lloyd says. “They’re signals of where advice, creativity, and tailored product selection can materially change lives.”

Practical fixes and policy pushes: Skipton’s twin-track strategy for FTBs

In response, Skipton spent the last year polishing its FTB proposition with a focus on practical, real‑world obstacles. For the lender, it was a worthy effort to meet the clear needs of an important demographic.

“In 2025, Skipton introduced a suite of changes designed to give brokers more tools — and customers more routes — to homeownership,” Lloyd explains, adding the focus of the three key developments is on targeted enhancements that solve real pain points.

Skipton’s Delayed Start mortgages^[1] offers eligible first-time buyers the facility to make no repayments for the first 3 months, but interest does accrue from day one. From furnishing the home to small improvements and moving costs, Lloyd describes it as “a pragmatic answer to cashflow pressure at move in” without undermining affordability over the mortgage term. Broker feedback is that this option is a useful, targeted addition that broadens advice options for the right customer.

The lender also strengthened its Track Record range by increasing the maximum loan‑to‑income ratio to 4.49, and up to 5 for incomes above £40,000 (subject to criteria). The core idea is to translate behavioural proof into borrowing capacity — an “affordability‑with‑evidence approach that many brokers welcome,” Lloyd notes, and the numbers support her observation: demand has more than doubled year-on-year.

“Smart brokers use products like Track Record and Delayed Start not only to place cases, but to educate introducers such as developers or estate agents, stimulate front‑end demand, and nurture prospects even when the eventual placement is a different product.”

For eligible Skipton Lifetime ISA customers, Skipton also offers a complimentary full property report via Move iQ, pulling together information such as floor plans, EPC ratings, local transport links and school data. This offering, which Lloyd refers to as a “one-stop digest,” helps both brokers and buyers make informed decisions swiftly.

Lloyd stresses that product innovation is only part of Skipton’s strategy. 2025 also saw the building society ramp up its public advocacy for fairer access to the property ladder.

In April, Skipton hosted a Parliamentary reception to present Skipton Group’s Home Affordability Index findings directly to MPs and policymakers, arguing that existing rules and thresholds don’t fully reflect the realities facing today’s aspiring homeowners.

A central plank of its campaigning has been for a more flexible approach to LTI limits, enabling certain borrowers with strong affordability to responsibly access higher multiples.

“Following strong lobbying from us along with peers across the industry, we were pleased to see changes from the PRA announced and acted swiftly to capitalise to benefit would-be buyers,” Lloyd says. “We believe that FTBs are the lifeblood of the housing market, and advocacy aligns with our founding purpose: making homeownership fairer and more achievable. The market needs practical innovation and systemic change — so we’re working on both fronts.”

2026: more solutions, more collaboration, more personalisation

Looking ahead, Skipton plans to lean into expanding choice and flexibility for FTBs, while also championing collaboration. If there’s one thing the lender knows, it’s that it can’t make meaningful change on its own.

“We’ll advocate for industry‑wide innovation and cross‑market cooperation between lenders, brokers, and policymakers to improve affordability and remove friction,” Lloyd explains adding that  data from the Home Affordability Index will continue to inform smarter criteria and targeted solutions to support brokers to personalise pathways for different buyer segments.

For brokers, Lloyd’s advice is comprehensive. Educate early, set realistic expectations, leverage every available option on a case-by-case basis, segment by region, and build resilience in borrowers by encouraging emergency savings and having those protection conversations.

But her best recommendation as 2025 winds down and the industry looks to the New Year?

“Talk to Skipton,” she stresses, underscoring the lender’s plan to keep innovating, simplifying the digital journey, and leading the charge to make homeownership more accessible.

“We’re steadfast in our commitment to brokers and to helping more FTBs onto the property ladder,” Lloyd concludes. “We’re here to help you build more viable routes to ownership — today, not tomorrow.”

These views are Jen’s own.

Mortgage products are subject to eligibility and lending criteria

For intermediary use only.

The Skipton Group Home Affordability Index is not a benchmark for the purposes of UK Benchmark Regulation, nor for the purposes of any other legislation or regulation. The Skipton Group Home Affordability Index is produced for information purposes only and must not be used or relied upon for commercial purposes including any decisions and/or advice. Skipton Building Society is not responsible for any decisions made based on this information.