More than six in 10 mortgages taken out by first-time buyers were joint loans last year, a report from Halifax shows.
It says 63% of FTB completions were agreed between two or more parties — according to combined data from Halifax, Lloyds Bank and Bank of Scotland — as raising interest rates and higher deposits made it harder to break into the property market alone.
The number of those who stepped onto the property ladder for the first time fell by 11%, to 362,461 last year, but this level was higher than any previous year, other than in 2006 and 2021’s record spike.
It says: “In 2021, the ‘race for space’, pent up demand from the pandemic and government measures to ease stamp duty costs, led to a record number of FTBs getting the keys to their first home.”
The average house price for FTBs rose 13% to £302,010 compared to a year ago, while average deposits for this group lifted 8% to £62,470.
However, FTBs account for 52% of all home loans – the highest in the last decade.
Average property values for this group are now around 7.6 times the average UK salary.
The most affordable area for FTBs in the UK is West Dunbartonshire, where the average earning in this area is £37,910 with the region’s average house price for this group coming in at £103,957. This means these buyers have to borrow 2.7 times average salary.
The least affordable areas in the country are in London, with FTBs facing average house prices of 10 times average salary if they want to buy in Westminster or Camden.
Halifax mortgages director Kim Kinnaird says: Buyers looking to make their first step onto the property ladder may welcome the forecasted fall in house prices this year – providing the supply is there. Nonetheless, the cost of purchasing a home is still significant and saving for a deposit can be challenging for some FTBs.
“The length of time needed, and cost of, raising a deposit are likely having an impact on the profile of the average FTB over time.
Today, those starting out on the housing ladder are 32 years old, on average – two years older than a decade ago – and almost two-thirds of people are now getting their first mortgage in joint names.”