According to analysis from Rightmove, the average first-time buyer monthly mortgage payment for a typical two-bed property is £940, which compares to £590 in 2020.
However, the report noted that the average first-time buyer monthly mortgage payment is £155 lower than the peak in 2023.
The research assumes that a first-time buyer has a 20% deposit and a 30-year mortgage term.
The average five-year mortgage rate is now 4.69%, compared to 2.22% at this time in March 2020 and 6.11% in July 2023.
Rightmove said average earnings have increased by 30% in the last five years, versus a 17% increase of a typical first-time buyer home.
Going digital
Sponsored by Halifax Intermediaries
The report said this has slightly increased the borrowing power of first-time buyers, which is an average of four-and-a-half times a single or joint income.
However, Rightmove said “affordability remains very stretched”, so proposals around loosening mortgage regulations are welcome.
| Region | Average asking price | Loan-to-income multiple (single income) | Loan-to-income multiple (joint income) | Loan-to-income multiple (single income, minus a 10% deposit) | Loan-to-income multiple (joint income, minus a 10% deposit) |
| London | £500,066 | 13.5 | 6.8 | 12.2 | 6.1 |
| South East | £292,414 | 7.9 | 4 | 7.1 | 3.6 |
| East of England | £272,035 | 7.4 | 3.7 | 6.6 | 3.3 |
| South West | £249,379 | 6.8 | 3.4 | 6.1 | 3 |
| West Midlands | £193,816 | 5.2 | 2.6 | 4.7 | 2.4 |
| East Midlands | £193,115 | 5.2 | 2.6 | 4.7 | 2.4 |
| Wales | £180,452 | 4.9 | 2.4 | 4.4 | 2.2 |
| North West | £175,557 | 4.8 | 2.4 | 4.3 | 2.1 |
| Yorkshire and the Humber | £174,303 | 4.7 | 2.4 | 4.2 | 2.1 |
| Scotland | £140,783 | 3.8 | 1.9 | 3.4 | 1.7 |
| North East | £132,854 | 3.6 | 1.8 | 3.2 | 1.6 |
London tops the loan-to-income (LTI) multiple, standing at 13-and-a-half times for single income and 6.8 times for joint income.
This was followed by the South East at 7.9 times income for single income and four times income for joint income, and then the East of England at 7.4 times income for single income and 3.7 times for joint income.
The North East requires the lowest LTI, at 3.6 times for single income and 1.8 times income for joint income.
Rightmove added that in over half of regions, a first-time buyer on a typical salary would not be able to afford a typical first home on their own if they were only able to borrow four-and-a-half times their salary, even if they’d saved up a 10% deposit.
Matt Smith, Rightmove’s mortgage expert, said: “Higher mortgage rates mean homemovers need to consider how much they can afford to pay each month on a monthly mortgage, even if they can meet the asking price of a home.
“Another measure of affordability [that] is restricting some first-time buyers from getting onto the ladder is how much they can borrow. It’s encouraging to see that the regulator is considering how they may be able to enable first-time buyers to borrow more in a responsible way, as we think this will help to unlock more opportunity, particularly for those with smaller deposits.”
Cheapest locations for first-time buyers
| Ranking | Area | Average asking price for a first-time buyer home | Average asking price increase year-on-year |
| 1 | Kilmarnock, Ayrshire | £84,325 | -1% |
| 2 | Greenock, Inverclyde | £88,862 | +0.7% |
| 3 | Grimsby, Lincolnshire | £93,427 | -1.2% |
| 4 | Blackpool, Lancashire | £93,711 | 0% |
| 5 | Middlesbrough, North Yorkshire | £95,473 | +0.8% |
| 6 | Hartlepool | £99,525 | +10.7% |
| 7 | Paisley, Renfrewshire | £99,570 | +2.3% |
| 8 | East Kilbride, Glasgow | £100,814 | +4.1% |
| 9 | Ayr, Ayrshire | £101,391 | +1% |
| 10 | Burnley, Lancashire | £102,848 | +6.2% |
