First-time buyers are beginning to edge back into the housing market after a difficult year encouraged by stabilising mortgage rates and the Bank of England’s base rate cut in December, according to latest figures from Yopa.
The group analysed the proportion of homes sold subject to contract within schemes aimed at first-time buyers and found that demand rose modestly in the final quarter of 2025.
Across Britain, 32.8% of first-time buyer suitable homes had secured a buyer in the fourth quarter, up from 32.3% in the previous three months.
The improvement comes despite a severe lack of supply. Properties available through first-time buyer schemes account for just 1.9% of all homes currently listed for sale, highlighting the structural shortage of entry-level housing that continues to limit market recovery.
REGIONAL BREAKDOWN
Demand is strongest in a number of regional cities. Newcastle led the table in the final quarter, with 57.6% of suitable homes already sold subject to contract. Bristol followed on 52.4%, with Liverpool close behind at 47.4%, pointing to intense competition among buyers in these markets.
Momentum also picked up in several areas. Plymouth recorded the largest quarterly rise, with demand up 14.1 percentage points to 34.6%.
Newcastle also saw a sharp increase of 13.4 points, while Cardiff posted a 12.2-point rise, suggesting buyer confidence has been recovering as borrowing conditions have steadied.
Even in markets with the most choice, availability remains thin. Plymouth offers the highest proportion of first-time buyer suitable homes, but they still make up just 2.3% of all stock. Portsmouth and London both stand at 1.6%, underlining how little product is available for those trying to get a first foot on the ladder.
FIRST-TIME BUYERS
Verona Frankish (main picture), Chief executive of Yopa, says: “After a challenging year for first-time buyers, it’s encouraging to see demand begin to edge higher as interest rates stabilise and confidence slowly returns, particularly following the base rate cut seen in December.
“However, while demand has improved, the underlying challenge for first-time buyers remains unchanged. The supply of homes available with the support of a buying scheme is still extremely limited and this imbalance continues to cap the pace of recovery.
“Until we see a meaningful increase in the availability of genuinely affordable first-time buyer homes, improvements in demand are likely to remain modest, even with a more settled outlook for the year ahead.”
