Mortgages

First-time buyers take majority market share in 2018

First-time buyers now account for just over 50% of all house purchases with a mortgage, an increase from 38% a decade ago.

Rozi Jones
|
25th February 2019
first time buyer ftb buyer young couple house
"Last year was the first year that first-time buyers accounted for the majority of the market since 1995"

First-time buyers accounted for the majority of home purchases in 2018 for the first time in 23 years, according to research from Halifax.

The number of first-time buyers reached 372,000 in 2018, an annual rise of 2%, although growth was at a slower rate than 2017 (7.6%) and 2016 (9%).

First-time buyers now account for just over 50% of all house purchases with a mortgage, an increase from 38% a decade ago.

Although the number of first-time buyers have increased nationally, the number of first-time buyers in Scotland and Wales has fallen over the last year.

The highest rise in house prices for first-time buyers is in Northern Ireland, up 7.5% in the last 12 months, although prices paid in Northern Ireland are still 16% lower than in 2008, and the number of first-time buyers in the region has more than tripled over that time.

Deposits grew fastest over the last year in the East and West Midlands, the South West and East Anglia, reflecting the continued increase in prices for first-time buyer properties.

Meanwhile average deposits in Scotland, Wales and the northern regions in England fell by between 2% and 9%, driven by a decrease in the average deposit as a percentage of the purchase price, combined with slower house price growth.

The top 10 most affordable local authority districts in the UK are all in the North West and Scotland. The most affordable are Pendle in Lancashire, Copeland in Cumbria with an average property price of £88,852 (Pendle) and £110,930 (Copeland), 2.6 times the local average gross annual earnings.

Of the 10 least affordable districts, nine are in London. The least affordable is Brent where the average first-time buyer property price of £500,088 is 13.3 times the gross average annual earnings for that area.

Oxford has joined the top 10 list since 2017 where the average first-time buyer property price is £400,730 – 10.9 times the gross average annual earnings for that area.

Russell Galley, mnaging director at Halifax, said: “New buyers coming on to the ladder are vital for the overall wellbeing of the UK housing market, and the continued growth in first-time buyers shows healthy movement in this important area – despite a shortage of homes and the ongoing challenge of raising a deposit.

“Last year was the first year that first-time buyers accounted for the majority of the market since 1995, which shows that the factors reducing some of the associated costs – such as continued low mortgage rates and Stamp Duty – are supporting the increasing number of people taking their first step on to the property ladder.”

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