The number of first-time buyers in the UK reached its lowest level in 10 years back in 2023, analysis by the Office for National Statistics found.
The ONS, which analysed data from the Financial Conduct Authority, revealed there were just 282,000 FTBs in the market in 2023, the lowest level since 2013.
This fall came despite sales of first-time buyer mortgages making up a greater proportion of total residential property sales in 2023 than they did in 2013, standing at 38.4 per cent and 28 per cent respectively.
April Mortgages COO, Mark Eaton, said: “The decline in first-time buyer mortgage sales across London and major UK cities over the past decade is largely due to affordability constraints.
“With house prices at record highs, many buyers struggle to secure a mortgage, as most lenders cap borrowing at 4.5 times income.
“This makes it harder to bridge the gap between property prices and available loan sizes, especially in London and the South East.
“Getting on the property ladder in the capital is almost impossible on your own and most joint mortgage applicants still require huge deposits.
“Our own research shows that a couple earning an average salary in the capital would need a deposit of over £200,000 to buy a home in nearly half of all London boroughs.
“One solution is longer-term mortgages of 10-years or more, which reduce monthly repayments and help borrowers qualify for larger loan amounts.
“This could improve affordability and enable more FTBs to purchase in high-cost areas, but it won’t fix the problem on its own.”
Regional disparity
However, the analysis pointed out this decrease in FTBs was not uniform across the whole of the country as several London boroughs saw some of the largest falls in the rate of first-time buyer mortgage sales between 2023 and 2013.
It detailed that, in 2023, 12.8 per cent of first-time buyer mortgages were sold for homes located in the capital, a decrease from 16.8 per cent a decade earlier.
Conversely, the south east of England had the highest proportion of first-time buyer mortgages, standing at 13.8 per cent in 2023.
Of the 10 areas with the highest rates of first-time buyer mortgages per 1,000 dwellings in 2023, just one was in London, compared with six in 2013.
tom.dunstan@ft.com
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