First-time buyer numbers set for near-record rise in 2025

The number of first-time buyers is expected to hit its second-highest level in a decade. 

Yorkshire Building Society analysis predicts 390,324 first-time buyer mortgage transactions in 2025 – up 18% on 2024 and close to the post-COVID peak in 2022 (405,250), which was driven by unprecedented government support, increased demand due to remote working and historically-low rates. 

The increase reflects improving affordability thanks to regulatory changes, industry innovation and falling interest rates. However, the Society’s group economist, Max Shepherd, warns more needs to be done to avoid a growing divide between those who are managing to buy and those who still can’t.

Official figures will be published in February [1], but trends up to October point to a strong finish to the year. The total value of first-time buyer completions is expected to reach £84.9bn, up 22% from £69.9bn in 2024. 

Max said: “First-time buyers have shown remarkable resilience despite high living costs, market volatility, the end of Stamp Duty incentives and elevated house prices. Tailwinds like real earnings growth, lower mortgage rates, and regulatory changes allowing lenders lend borrowers more times their income are helping more people onto the ladder. 

“But we must keep momentum going. We know how important the prospect of owning their own home is to people, yet many still struggle to save a deposit or meet affordability checks. We don’t want to see a growing divide between the ‘haves’ and ‘have-nots’ when it comes to homeownership.”

Yorkshire Building Society is committed to making homeownership more accessible for more people, and was among the first to adopt this year’s regulatory changes to loan-to-income limits, allowing it to lend, on average, 15% more or £37,000 extra to borrowers. Its innovative £5k Deposit Mortgage, launched in 2024, which enables buyers to borrow up to £500,000 with a deposit of just £5,000, has also helped 1,800 first-time buyers into homes.

The number of house purchases completed with mortgages is also expected to have risen by 16% to 717,588 in 2025, from 619,120 in 2024; driven largely by first-time buyers, who make up 54% of that total.

1. Based on UK Finance actual mortgage completions data to 31 October 2025, with November and December 2025 volumes estimated by Yorkshire Building Society, in line with previous first-time buyer patterns. Full actual 2025 data (Jan – Dec) to be published in February 2026 by UK Finance.