First-time buyer mortgage sales at lowest level since 2013
Fewer first-time buyers in England’s most urban areas
While the rate of first-time buyer mortgage sales has been falling in London, they have risen in more rural areas.
On average, rural areas in England and Wales saw rates of first-time buyer mortgages rise by 9.7% between 2013 and 2023, while urban areas saw a 3.7% rise on average.
In 2013, all 20 areas with the highest rates of first-time buyer mortgages were urban, with the majority of the population near to a major town or city, according to the 2021 urban rural classification.
However, as numbers of first-time buyer mortgage sales grew between 2013 and 2021, rural areas saw some of the highest growth rates (63.3% on average compared with an average of 48.8% across urban areas).
The rate of first-time buyer mortgages in West Oxfordshire grew from 7.2 per 1,000 in 2013 to 16.6 per 1,000 in 2021, an increase of 131.8%, the highest of any local authority in this period.
By 2021, three of the 20 areas in England and Wales with the highest rates of first-time buyer mortgages were ‘intermediate rural’, with the majority nearer to a major town or city. These were:
Central Bedfordshire (22.3 per 1,000 dwellings)
South Derbyshire (21.2 per 1,000)
Bolsover (19.3 per 1,000)
Between 2021 and 2023, as first-time buyer mortgages sales began to fall, rates fell faster in rural areas (-32.3%) compared with urban areas (-30.1%).
Those urban areas which saw the strongest growth in first-time buyer mortgage sales in the full decade between 2013 and 2023 were outside London, in:
Harlow in the East of England (68.6%)
Knowsley in the North West (63.3%)
Nuneaton and Bedworth in the West Midlands (56.1%)
A small number of local authorities in England and Wales could not be included in these urban-rural comparisons. This is because some local authorities have changed boundaries since they were classed as rural or urban from 2021 census data.
First-time buyer mortgage sales at lowest level since 2013
By looking back through nearly two decades-worth of data, we can see how certain events affected the number of first-time buyer mortgage sales.
For the available time series, the number of UK first-time buyer mortgages sold was relatively high in 2006, at around 377,000, but by the time of the 2008 global financial crisis two years later, that number had fallen by nearly half to 186,000.
The number of first-time buyer mortgages in the UK dropped to a 10-year low in 2023
Number of first-time buyer mortgage sales, United Kingdom, 2006 to 2023
First-time buyer mortgage sales stayed low for the next five years, before they began to increase in 2013.
The number steadily increased through the 2010s but fell from 339,000 in 2019 to 297,000 in 2020, the year when lockdown restrictions during the coronavirus pandemic affected the housing market.
The number of first-time buyers increased the following year, and 2021 saw the highest number of new mortgages in the time series, 394,000. This may have been influenced by the stamp duty holiday, which was in effect from June 2020 to July 2021.
Since 2021, numbers of first-time buyer mortgages have been steadily declining, and this trend has continued in 2023, with numbers dipping to the lowest levels (282,000) since 2013.
However, when looking at the number of first-time buyer mortgages as a proportion of all residential property sales, there has been a steady increase since 2006.
Less than a quarter of all residential property sales in the years from 2006 to 2008 were for first-time buyer mortgages, rising to around a third (33.8%) in 2018.
By 2023, 38.4% of residential property sales were first-time buyer mortgages. This is because the overall number of residential property sales fell faster between 2021 and 2023 (-39.8%) than first-time buyer mortgages (-28.6%).
The full report from the ONS: First-time buyer mortgage sales, by local authority, UK: 2006 to 2023 – Office for National Statistics
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