First-Time Buyers Now Over Half of UK Mortgage Sales as Market Recovers – ONS

Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.

First-Time Buyers Now Over Half of UK Mortgage Sales as Market Recovers – ONS

First-time buyers accounted for 52.8% of all mortgage sales in 2025, according to Office for National Statistics (ONS) data, up from 33.8% in 2006. Total UK mortgage sales reached 717,519 in 2025, up from 617,295 in 2024 — the highest annual total since 2021.

First-Time Buyer Activity Grows

Mortgage sales to first-time buyers rose from 326,474 in 2024 to 379,207 in 2025. The ONS figures show first-time buyers now represent a significantly larger share of the market than they did two decades ago, when they accounted for just over a third of sales.

Richard Pinch, senior director at Broadstone, said mortgage activity showed clear signs of recovery in 2025, with sales reaching their highest annual level since 2021 as buyers returned to the market following a period of higher interest rates and affordability pressures. He said the mortgage market has undergone a significant structural shift, with first-time buyers playing an increasingly central role in driving activity and reflecting changing dynamics of homeownership.

Regional Recovery Across the UK

Mortgage sales rose in every UK region in 2025. The East Midlands led the recovery with a 21.3% year-on-year jump, followed by the East of England (up 19.7% to 75,376) and the North West (up 19.1% to 79,775). The West Midlands and North East posted increases of 18% and 17.7% respectively, while the South East — the UK's largest regional mortgage market — rose 17.2% to 107,272. Growth was more muted in London (up 11.8% to 73,308) and Northern Ireland (up 11.5% to 16,634).

Borrowers Stretching Further

Loan-to-income (LTI) and loan-to-value (LTV) ratios rose across much of the UK in 2025. The average UK LTI ratio increased from 3.3 to 3.5 for all buyers, and from 3.5 to 3.6 for first-time buyers. First-time buyer LTV ratios climbed from 85% to 85.6% — the highest level since before the financial crisis — suggesting buyers are relying more on borrowing and contributing smaller deposits.

Regional differences were stark: the North East recorded the highest first-time buyer LTV ratio at 89.8%, followed by Scotland (89.7%) and Wales (88.9%), while London was lowest at 80.2%. London also had the highest LTI ratios, at 3.9 for all buyers and 4.0 for first-time buyers, compared with 2.9 and 3.0 in the North East.

What This Means for Letting Agents and Inventory Clerks

With more first-time buyers entering the market and stretching deposits and incomes, demand in the sales market may influence rental stock levels in some regions. Agents and clerks should note the regional variation in activity, with the strongest growth in the East Midlands, East of England and North West.