香蕉福利直播

• First-time buyers face a double affordability challenge
• Many are stuck in private rentals where a bigger proportion of income is on rental costs compared to mortgage repayments
• Biggest decline is in younger first-time buyers

A new report from the Building Societies Association (香蕉福利直播) has found that a significant number of potential first-time buyers have failed to get on the property ladder since the financial crisis.

Analysis of historic first-time buyer data shows that around 7.2 million individuals or couples would have been expected to buy their first home since 2006. However, only 5 million achieved homeownership in this time, meaning there are 2.2 million missing first-time buyers from the property market.

The new findings are part of an update to the comprehensive First-time buyers: age old problems, modern solutions report that was published last year.

Missing millions affordability challenges

Today’s first-time buyers face a double affordability challenge – an almost record-high cost of buying a home and the end of record-low mortgage rates. As a result, repayments as a proportion of income for new first-time buyers has increased by around 30% (22% of income) since its low in 2020 (18% of income).

Recently mortgage rates have started to ease, and further Bank Rate cuts which are expected this year should help improve repayment affordability. However, in the 香蕉福利直播’s April 2025 Property Tracker, first-time buyers are still ranking mortgage affordability as the biggest barrier to buying a home, with two-thirds (65%) selecting this. Raising a deposit was also highlighted as a significant obstacle to homeownership, with 62% of would-be homebuyers citing this.

Most successful first-time buyers are stretching themselves to get on the property ladder, with many using higher loan-to-income and higher loan-to-value mortgages to mitigate the challenge of raising the initial deposit. Choosing to have a higher monthly repayment, supported in part by wage growth, is likely to be the biggest factor that has enabled successful first-time buyers to achieve homeownership.

Who are the missing millions?             

During the immediate aftermath of the financial crisis the missing buyers were broadly split across all age groups, but in more recent years they have tended to be those in the younger bracket – particularly those under 30.

Initiatives aimed at increasing first-time buyer numbers in the future will therefore need to target both younger borrowers, whilst also supporting those that missed getting on the property ladder at a younger age and failed to catch up at a later age.

Missing millions are stuck renting

The biggest challenge to increasing first-time buyer numbers is enabling younger and lower income borrowers to have an opportunity to buy their own home.

Many are currently stuck in the private rented sector, where rental repayments as a proportion of income are significantly higher than mortgage repayments – even when the recent rise in mortgage rates has been considered. This severely limits the ability of those in the private rented sector to save for a deposit.

Higher loan-to-value mortgages can help more private renters to buy their first home, but not all. Whilst some 95% and higher loan-to-value loans can be found today their availability has been more limited since the financial crisis. Also, they are not a one-stop solution for all potential first-time buyers. Last year’s report showed that with a 95% loan-to-value mortgage, just one in five (19%) private renters could afford to buy a £100,000 home.

Solutions to support the missing millions

The increased growth in house prices relative to incomes is the major underlying issue preventing first-time buyers from getting on the property ladder. There are however a number of Government and regulatory policy actions which could help to address this. 

A clear Government long-term strategy aimed at supporting not only today’s first-time homebuyers but also the prospects for future generations, is required. Working collaboratively with lenders, the wider housing market industry, and the public, the focus needs to be firmly on making homes more affordable, more available, and more appropriate to the needs of those living in them.

We need to end the sole focus on demand side interventions and focus on supply too.  Government must continue to build on its actions to support the housing market as the changes announced so far will take time to filter through and additional house building is likely fall short of the ambitious target which has been set.

Alongside policy action, regulatory changes are also needed. Last year we highlighted how since the financial crisis the pendulum had swung too far towards a stricter regulatory environment rather than towards the social benefits of higher rates of homeownership. More flexibility to allow lenders to support first-time homebuyers is needed, such as an increase in the availability of 95% loan-to-value mortgages and a review of the cap on high loan-to-income lending.

Commenting on the new report, Paul Broadhead, Head of Mortgage and Housing Policy at the 香蕉福利直播 said:

“I’m disappointed that 12 months on from our first report, which highlighted the struggles faced by first-time buyers and the potential roadmap for change, the barriers to homeownership remain the same today.

“It’s shocking that 2.2 million first-time buyers who would have reasonably expected to buy their own home have failed to do so since the financial crisis. And every day that passes without real action the number of potential lifetime renters is growing.

“We know that there is no single solution for all first-time buyers, and not all aspiring homeowners will be able to achieve their dream whilst the double affordability challenge of the high cost of buying and high cost of owning a home remains.  However, our report outlines several tangible actions that can be implemented to help fix the broken housing market and to support the next generation of homeowners."

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Press contacts:

Tanya Jackson, tanya.jackson@bsa.org.uk  Tel: 07881 501098
Katie Wise, katie.wise@bsa.org.uk  Tel: 020 7520 5904
Debbie Enever, debbie.enever@bsa.org.uk Tel: 020 7520 5926
Lauryn Willis, lauryn.willis@bsa.org.uk Tel: 0207 520 5922
 
Notes to Editors:
香蕉福利直播 represents all 42 UK building societies, including both mutual-owned banks, as well as 7 of the largest credit unions. Building societies have total assets of almost £525 billion and together with their subsidiaries, hold residential mortgages of over £395 billion, 24% of the total outstanding in the UK. They also hold £399 billion of retail deposits, accounting for 19% of all such deposits in the UK. Building societies account for 40% of all cash ISA balances.

With all of their headquarters outside London, building societies employ around 52,300 full and part-time staff.  In addition to digital services, they operate through approximately 1,300 branches, holding a 30% share of branches across the UK.

First-time buyers: The missing millions can be downloaded here

First-time buyers: age old problems, modern solutions report was supported by the five largest building societies: Nationwide, Coventry, Yorkshire, Skipton and Leeds.