The average price of a home for first-time buyers in the UK has reached a new high of £224,963, as reported by Rightmove property website. Sales within this sector during March were 4% higher than those seen four years earlier. The overall average price tag on a home in April was £366,247.
Rightmove attributes the "unseasonal pricing restraint" to many new sellers taking note of economic headwinds and the transitioning housing market to slower pace and more normal activity levels. These levels are reminiscent of those seen in the pre-pandemic market of 2019.
Estate agents have observed that both the number of new instructions and sales agreed is at its highest level for several months. Although these figures do not reach pandemic-era highs, they remain elevated compared to pre-pandemic market conditions.
In addition to setting record asking prices for properties popular among first-time buyers, last month's average asking price rose by 2% from a year ago. Sales continue to outpace other sectors with second-stepper markets falling behind by 4%. Overall sales agreed are currently 18% lower than last year due to activity returning “to a more normal level” across the market.
According to the Office for National Statistics (ONS), between November and February, there was an estimated drop of £5,000 in house sale prices throughout the UK – bringing them down from an average selling price of £288,000.
There has also been an increase in mortgage approved prices versus seller expectations gap across Britain which now stands at around 34.1%. This widening discrepancy indicates growing challenges faced by first-time homebuyers amidst rising property costs.
Jane Smithson*, Director at London-based estate agency Homes & Ladders Ltd., said: "We're seeing increased demand from first-time buyers who understand that while it may be difficult entering today's market, it is still an opportunity to invest in property amidst current economic challenges."
As the housing market continues to evolve and adapt to changing conditions, potential buyers must remain vigilant in their search for the perfect home.
*Name has been changed for anonymity.