Majority of Initial Property Owners Moved Back Home With Parents to Achieve Home Ownership, Study Reveals
First-Time Buyers in the UK Facing Challenges but Finding Opportunities in 2025
First-time buyers in the UK are navigating a market characterised by high supply and significant price sensitivity, according to recent data. This trend, coupled with evolving location preferences, is shaping the experiences of those entering the property market.
Compromises Abound
Younger buyers are increasingly compromising on property size, location, type, and condition to enter the market. While specific UK data on compromises is less detailed, the general trend in comparable contexts shows 71% making trade-offs on size, 45% on location, and 33% accepting homes needing work. UK buyers are similarly price-sensitive due to rising mortgage rates and a high volume of homes for sale, implying many first-time buyers must be flexible to purchase.
Financial Aid and Market Conditions
Demand picked up in mid-2025 after a stamp duty deadline in March caused earlier transaction spikes. However, mortgage affordability remains a concern. Some easing in mortgage rates is expected due to economic data weak spots, which may support modest price growth and demand in the latter half of 2025. There is also an increase in buyer inquiries after a subdued early year, indicating returning demand aided by favorable mortgage expectations and high stock availability.
Location Preferences
While precise location preferences of first-time buyers are less detailed for the UK, trends in the country house market show interest in areas with access to London and countryside appeal (e.g., Hampshire, North Cotswolds, South Gloucestershire, Sussex) indicating some buyers value lifestyle and transport connectivity when compromising. This can parallel first-time buyer choices seeking affordable yet desirable suburban or semi-rural locations with good amenities and commutes.
A Cautious but Improving Landscape
This represents a cautious but improving landscape for UK first-time buyers in 2025, balancing compromises with some government tax changes and market dynamics.
First-Time Buyer Trends from TSB
TSB's Secured Lending Director, Craig Calder, shared practical steps for buying a first home and becoming mortgage-free. Three quarters of new property owners opted for fewer bedrooms, a smaller property, and less outdoor space to buy in a preferred post code. First-time buyers were paying an average of £960 a month in rent prior to purchasing their home. Almost one in 10 new homeowners said they had made a major compromise and opted for affordability and location.
Over 1,000 first-time buyers who purchased a property in the past year were surveyed. Almost two fifths of new homeowners said their new home was mostly what they wanted, but with a few compromises. Over a fifth of new homeowners said they had purchased their dream home. Tips for managing a mortgage include remortgaging regularly, overpaying if possible, and reassessing at key life stages. The average age of TSB customers in H1 2023, 2024, and 2025 in various regions has been provided, along with the average term (years) for TSB customers in the same periods.
Financial Help and Mortgage Choices
Almost every first-time buyer (96%) surveyed received some form of financial help with their deposit. Tips for choosing the right mortgage include deciding whether a fixed or variable rate is right, talking to a bank or mortgage broker, and considering additional costs like fees and Stamp Duty. As a result of buying their first home, 45 percent felt financially more secure and almost two fifths felt relieved.
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- Many first-time buyers in the UK are compromising on various aspects of the property they purchase, including size, location, type, and condition, in order to enter the market.
- TSB's Secured Lending Director, Craig Calder, shared tips for first-time buyers, noting that 75% of new property owners opted for fewer bedrooms, a smaller property, and less outdoor space to buy in a preferred postcode.
- Almost every first-time buyer (96%) surveyed received some form of financial help with their deposit, and tips for choosing the right mortgage include deciding between a fixed or variable rate, talking to a bank or mortgage broker, and considering additional costs like fees and Stamp Duty.
- First-time buyers who purchased a property in the past year were surveyed, and almost two fifths of new homeowners said their new home was mostly what they wanted, but with a few compromises, while over a fifth said they had purchased their dream home.
