Analysis from Zoopla showed that all buyers had more buying power due to improvements in mortgage affordability in recent months, which explained the 30% increase in first-time buyer mortgages and why they were able to choose higher-value homes.
Further, its data found that first-time buyers were mostly focused on buying three-bedroom houses, with 45% going for this property type, while fewer were choosing flats, falling to a share of 29%.
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|
Region |
Average first-time buyer house price growth |
Average house price growth of all homes |
Average cost of first-time buyer home |
Average cost of all homes |
Price difference (%) |
|
North East |
10.2% |
2.4% |
£134,800 |
£146,600 |
8% |
|
Scotland |
6.4% |
2.1% |
£146,600 |
£170,500 |
13% |
|
Yorkshire and the Humber |
6% |
1.9% |
£167,700 |
£192,500 |
15% |
|
Wales |
4% |
2.1% |
£172,800 |
£207,209 |
17% |
|
North West |
5.1% |
2.7% |
£179,300 |
£201,281 |
11% |
|
West Midlands |
2.7% |
1.6% |
£208,000 |
£233,902 |
11% |
|
East Midlands |
1.7% |
1% |
£210,000 |
£231,006 |
9% |
|
South West |
1.9% |
0.3% |
£245,000 |
£312,006 |
21% |
|
Eastern England |
0.7% |
0.8% |
£316,900 |
£337,498 |
6% |
|
South East |
2.7% |
0.2% |
£323,300 |
£385,257 |
16% |
|
London |
-2.4% |
0.2% |
£420,600 |
£534,038 |
21% |
|
UK |
2.4% |
1.3% |
£229,000 |
£268,449 |
15% |
First-time buyers putting more down in affordable areas
Zoopla’s data also identified regional differences in the house prices of properties sought by first-time buyers.
It found that first-time buyers in the North East were looking to buy homes that were 10.2% more expensive than a year ago, while squeezed affordability pressures and higher stamp duty costs meant that in London, they were seeking homes that were priced 2.4% lower.
In Scotland, the value of homes in demand by first-time buyers was up 6.4%, compared to 2.1% across the wider market, while in Yorkshire and the Humber, this was up 6% compared to 1.9%. In the North West, it was up 5.1% compared to 2.7% across the whole market.
Richard Donnell, executive director at Zoopla, said: “First-time buyers have had a 20% boost to affordability over the last six months. This is enabling them to look at buying higher-value homes in the more affordable parts of the country, which is supporting faster house price growth across the board.
“In contrast, first-time buyers in London and Southern England are looking for cheaper homes than a year ago, despite the extra borrowing capacity. The ending of stamp duty reliefs since April has added to the cost of buying a home for first-time buyers. Large deposits and mortgage regulations mean a high household income is needed to buy in Southern England, where affordability remains a challenge, and this is acting as a drag on house price growth across Southern England.”
He added: “The variation in affordability explains why first-time buyers across England are looking to buy three-bed houses, while in London, one- and two-bed flats remain the primary target for those buying their first home.”
