"Many first-time buyers are on modest incomes, even as they reach their late 30s, which leaves very little room for error when it comes to affordability"
- Nakita Moss - Twenty7Tec
Mortgage data and technology firm, Twenty7tec, says home ownership is becoming harder for ordinary working households. With affordability stretched and the national average wage around £37,800, households relying on two incomes are increasingly under pressure.
Now, the market faces a new challenge: what happens when even two earners cannot meet the cost of buying a home?
Nakita Moss, head of lender at Twenty7tec, said: “Increasingly, the answer is found not in higher earnings, but in outside help. Many first-time buyers are on modest incomes, even as they reach their late 30s, which leaves very little room for error when it comes to affordability. This has led to people having to wait longer to save a deposit, often skipping smaller flats and moving straight into family-sized homes as they juggle career progression with starting families. From this, advisers are having to reassess how they guide clients on long-term affordability and risk.”
The average UK property price now sits around £290,000, while wage growth has lagged behind rising living costs and strict lending rules. Even with a combined income of £60,000, first-time buyers are usually limited to a mortgage of about £270,000, requiring a deposit of roughly £30,000 to reach the national average purchase price.
Regional differences make the challenge even harder
In the South East, average property prices have climbed above £440,000, pricing many buyers out entirely.
Cities such as Leeds and Manchester have seen sharp increases, driven by investment and relocations from London after the pandemic.
Average property values in these cities now hover between £250,000 and £260,000, but family homes in more affluent areas regularly exceed £400,000.
This widening gap is changing where and how people can buy. Government measures like stamp duty relief for first-time buyers have offered some short-term support, but they have not addressed the deeper affordability issue, particularly after the nil-rate threshold was reduced from £425,000 to £300,000 earlier this year.
Nakita added: “When considering each of these factors, we predict that those stuck in ‘Generation Rent’ will choose unconventional methods to get on the ladder. We are already seeing a steady rise in group mortgages, with friends or family members buying together, as well as intergenerational households and co-ownership living models.
“Our data also shows that around one in seven first-time buyers (15.4%) are now aged over 40, while the number of those aged 51 and over purchasing their first home has risen by 80% in the last five years. Longer-term lending is no longer a niche product but an essential tool, with many mortgages now stretching well into retirement."
"For advisers, it means adapting conversations with clients, helping them think not just about getting onto the ladder but about sustaining affordability throughout the lifetime of the loan.
“What concerns us is that if the two-salary ceiling becomes the new normal, what other implications can this have for buyers, especially second steppers and those looking to buy in later life? One thing is for sure, the traditional path to home ownership is being redefined and without intervention, could we see an entire generation priced out of home ownership altogether?”
