- Uniquely detailed analysis from the Skipton Group Home Affordability Index tracks how the profile of first-time buyers and their homes has transformed over three decades
- The Index – created in partnership with Oxford Economics – shows how the under-25 first-time buyer market has collapsed since the 1990s, forcing people to buy later in life, with long-term potential consequences for young families and housing security
- The majority of first-time buyers now rely on two full-time incomes and a growing number receive financial help from family
- There’s a glimmer of hope on the horizon with an estimated 125,000 more households expected to be in a position to afford their first home by the end of 2028 due to a forecast rise in first-time buyer affordability – but the prospect of higher borrowing costs driven by recent geopolitical developments and a rise in energy prices may put those affordability gains at risk
- Bigger, better-quality homes on offer for those who can afford to get on the ladder
The Skipton Group Home Affordability Index today reveals the true scale of how access to first-time homeownership has transformed in England.
Drawing on decades of data to build a uniquely detailed long-term profile, Skipton Group’s research created in partnership with Oxford Economics – shows the average age of a first-time buyer in England has risen from 29 to 34 since the mid-1990s.
This has been driven by a collapse in the number of under-25s buying their first home, from almost one in four purchases in the mid-1990s to around one in fifteen today.
In the past decade, the proportion of first-time buyers with children has fallen sharply, from around a third to just over a quarter.
Over half of recent first-time buyers (52%) now rely on two or more full-time incomes – a material shift from the 1990s, when this was just 40%. Around a third now also receive help from family, and over half (54%) of those with mortgages are stretching repayments across 30 years or more.
Deposits have also risen faster than wages, with the average first-time buyer now needing to save more than a full year of their household’s combined income to buy their first home.
Affordability barriers persist even for higher earning potential first-time buyers: only around one in three of these households earning over £77,800 can afford the average first-time buyer home in their local area using their own finances.
Cautious optimism for affordability outlook
Against the backdrop of the long-term decline outlined in the report, there are now modest signs that buying affordability may begin to improve. Looking ahead, the Index projects first-time buyer affordability will improve from 12.1% in 2025 to 14.4% by end of 2028 – this improvement equates to roughly 125,000 more first-time buyers able to enter the market.
However, this improvement is limited to buying affordability only. Living costs were forecast to remain persistently high even before the recent economic fallout of conflict in the Middle East, with around 40% of potential first-time buyers still expected to face unaffordable essential housing costs over the coming years.
Increased global uncertainty – including potential impacts on energy prices, inflation and interest rates – could derail the pace and scale of this projected improvement.
For those who do manage to buy, the research shows average first homes are larger, better quality and more energy efficient than in previous decades. First-time buyers are more likely to purchase houses rather than flats, the average size of first homes has increased slightly, and nearly 90% now meet the Decent Homes Standard.
The data also shows a divide between London and the rest of England in space versus quality for recent first-time buyers. Londoners buy flats with fewer bedrooms and the smallest floor space, but live in more energy-efficient, newer and higher-quality living spaces than the North and East.
Stuart Haire, Skipton Group CEO, said:
“This research tracks, in detail, how the opportunity to buy a first home has declined over several decades. It shows how the aspiration of homeownership has been pushed further out of reach for many younger adults, delaying independence and stability.
“With fewer people buying in their twenties, there’s a growing dependence among first-time buyers on two full-time incomes or help from their parents. However, it’s encouraging to see early signs that affordability may be starting to improve, and the focus has to be on realising those gains and ensuring more people can realistically share in them. This has become all the more important amid the current pressures on energy prices and potential further increases in living costs.
“As a mutual focused on helping more people get onto the housing ladder, Skipton believes it’s important to put clear, long-term evidence into the public debate to inform policy and drive meaningful action.”
About the Skipton Group Home Affordability Index
The Skipton Group Home Affordability Index, created in partnership with Oxford Economics, provides unique insight into the affordability challenges faced by renters, first-time buyers and homeowners by age, income, geography and family type. It utilises data from across Skipton Group businesses, the Office for National Statistics, the Bank of England and third-party external sources. Its comprehensive analysis and forecasting covers all 363 local authority areas across Great Britain as well as at the regional and national levels.
- For more information on the Index findings click here for the Index Report.
- To explore living affordability and buying affordability across Great Britain, click here for the dedicated interactive tool
- For more information on the methodology behind the Index click here.