LONDON DAILY ARCHIVE
First-Time Buyer Mortgage Payments Rise by £350 in Five Years
Analysis reveals significant increases in mortgage payments and regional price variations for first-time buyers in the UK.
06 March 2025 · 06:24 UTC
Despite this increase, current mortgage payments are reported to be £155 lower than their peak, recorded in July 2023.
This analysis, performed by Rightmove, considers typical asking prices for properties aimed at first-time buyers and current mortgage rates.
It assumes that buyers are purchasing homes with two bedrooms or fewer, utilizing a 20% deposit, and spreading mortgage repayments over a 30-year term.
The current average price tag for a first-time buyer home is estimated at £226,887.
In examining options for more affordable housing, Kilmarnock in East Ayrshire, Scotland, has been identified as the most affordable area for first-time buyers, with an average asking price of £84,325.
Following Kilmarnock, Greenock in Inverclyde registers an average asking price of £88,862, while Grimsby in Lincolnshire is third, with properties averaging £93,427.
The analysis indicates that, despite rising mortgage costs, average wage growth has surpassed the increase in housing prices over the past five years.
Average earnings have reportedly grown by 30%, compared to a 17% rise in the price of a standard first-time buyer property, utilizing data from the Office for National Statistics (ONS).
Rightmove’s mortgage expert noted the impact of higher mortgage rates on home affordability, suggesting that prospective buyers must carefully assess their financial capabilities relative to monthly payments, independent of home listing prices.
He highlighted the significance of borrowing capacity as an additional factor affecting first-time buyers' ability to enter the property market.
In this regard, the Financial Conduct Authority (FCA) has announced it is exploring ways to simplify mortgage regulations, which may aid home buyers in their quest for property ownership.