Its estimates, which are based on data from trade body UK Finance, found that around 408,000 first-time buyers got onto the housing ladder in 2021. That is a substantial 35 per cent increase on the year before, and the highest figure seen in more than two decades, dating back to before the financial crash hit.
The mutual said the last first-time buyer peak was back in 2002, when around 531,800 homebuyers bought their first property. It noted that the figures for 2021 were broadly double the levels of first-time buyers seen immediately after the financial crisis, when they hovered around the 200,000 level between 2008 and 2012.
What’s more, first-time buyers last year represented around half of all purchases, compared with a little over a third in 2007.
Yorkshire Building Society said first-time buyers were benefiting from the combination of falling unemployment, low borrowing costs and increased mortgage options for those with small deposits. It pointed to the various lockdown measures as having helped would-be buyers to put together bigger deposits, making it easier to purchase a first home.
Nitesh Patel, strategic economist at Yorkshire Building Society, described the performance of the first-time buyer market as “extraordinary”, particularly given the uncertainties caused by the lockdown at the start of 2021.
He continued: “In the near-term housing demand will continue to exceed supply, however with prices at an elevated level in comparison to local earnings, this should dampen activity. Therefore, it’s unlikely that we will continue to see first-time buyer numbers at this level in 2022 and beyond.”
A previous study by Yorkshire found that the typical first-time buyer would have to wait nine years in order to get onto the ladder, five years longer than they might expect.