By using this website, you agree to our use of cookies to enhance your experience.


First-time buyers frozen out of the market

Demand for rented homes looks set to increase in the coming months as new data suggests that many people who do not yet own property will not do so for quite some time.

The gap between income and house prices has sky-rocketed in recent years with various reports suggesting that a growing number of younger people are giving up the idea of ever owning their own home for now. 

The latest forecast from Zoopla shows that the share of homes purchased by first-time buyers in the UK looks likely to drop for the first time in five years – making up around 33.9% of home purchases in the UK for 2020, down from a 10-year high of 34.9% in 2019.


First-time buyer demand and their ability to purchase property is starting to be impacted by Covid-19, the recession, and reduced availability of higher loan to value mortgages. 

Weaker demand amongst first-time buyers correlates directly with when lenders started to withdraw high loan-to-value mortgage products in early June, according to Zoopla. 

Last year, around a fifth of all mortgages for home purchase were at or above 90% LTV. Reduced availability of mortgages at or over 90% LTV – as lenders meet increased demand at mid to lower LTVs – is a primary factor behind this weakening demand. 

Richard Donnell, research and insight director, Zoopla, said: “A change in the mix of buyers is supporting market conditions with sustained demand from equity rich existing owners seeking more space and a change in location. In contrast, first-time buyer demand is weakening. 

“First-time buyers have been a driving force of housing sales over the last decade. They remain a key buyer group but lower availability of higher loan to value mortgages and increased movement by existing home-owners means a shift in the mix of home buyers into 2021.”

The remainder of 2020 and the start of 2021 are set to witness a reversal of the first-time buyer market dominance with a greater share of moves by existing home-owners who tend to move less often. 

Nisha Vaidya, mortgage expert at Bankrate UK, said: “It’s telling that even with schemes like Help to Buy and the stamp duty holiday, potential first-time buyers are withdrawing from the property market. 

“The Covid-19 pandemic has changed the rules of the game, as low deposit mortgage deals have disappeared and house prices have soared. At a time when wealthy homeowners are upgrading their properties, first time buyers are getting left by the wayside.” 

Want to comment on this story? If so...if any post is considered to victimise, harass, degrade or intimidate an individual or group of individuals on any basis, then the post may be deleted and the individual immediately banned from posting in future.

  • icon

    It would seem to me that most of the young only have themselves to blame here, mostly by their indulgent life styles , the i'm entitled attitude, and not wanting to get there hands dirty helping themselves. Also the high loan to value mortgage is a thing of the past, just as us landlords now need to be more and more careful who we rent to, banks are having to be very careful who they lend to.


    I have to agree Andrew, of the young adults in my immediate circle they all want the Instagram lifestyle before earning it and everything put on a plate for them. There doesn't seem to be any real sacrifice or dedication, just that 'mum' or 'dad' will pay for it.

    Algarve  Investor

    Good old sweeping generalisations. I'm not 'young' anymore, but I know some who are - and not all of them are Instagram millennials afraid of hard work or sacrifice. Just as all baby boomers aren't selfish, greedy, I'm alright Jack Brexiteers.

    In the 80s and 90s, you could afford a house in London - London! - with a fairly low deposit. Houses could be purchased in the capital for £100k or less. What would you get for £100k in London now - a shed, a garage, a small patch of land? Houses prices were 2x the average salary, now they're something like 10x. It's almost impossible for young people to afford a home in London or the South East without parental support or inheritance. That wasn't the case 20 or 30 years ago. Even in the early 2000s, house prices in the UK weren't at the stratospheric levels they are now.

    I know of more middle-aged people who indulge in avocado on toast, flat white coffees and the high life than younger people, who are having their life chances disrupted by Covid, Brexit, a dreadful, insecure jobs market and an incompetent government. They can't even enjoy uni at the moment.

    If expecting semi-affordable housing and not a lifetime of renting in substandard accommodation is being entitled, then we should all be entitled.

    Young people don't have it easy, far from it, and plenty are willing to work hard. Even then, why should people have to work ridiculously hard and sacrifice everything just to get on the housing ladder?


    I'm 22 and understand I am well in the minority on platforms like these aimed at landlords, who are primarily in a 40-60 age bracket. But it is incredibly arrogant to brand an entire demographic as being vain and entitled. I have never felt the need to comment on this page quite as I have after reading this comment and the reply below it.

    Many of us are hard-working. Let's not ignore the facts. In my parent's day, you could quickly start working in London in a decent job without extensive qualifications. Now, young people like me will be pushed out of vast opportunities unless we have a degree. That's three years, five years including A-levels, that I have spent working towards a qualification I felt I had to get to survive in the job market. I could have spent those years working my way up the ranks in a job in those five years, and probably would have had enough money for a deposit.

    The rate of inflation on properties far exceeds the expense it cost to buy a property when my parents were my age. It is tough at the moment. It is saddening to see that older generation are degrading a whole generation of young people as being idle and unmotivated when the odds are currently against us to become homeowners. Many young people base their spending choices on the fact that becoming a homeowner feels so far out of their reach, not merely because they don't want to save. It is sad that it has gotten to this point.


    Landlords tend to meet much more of the Generation Rent than any other sector does and in my extensive experience in dealing with them I think Andrew is 100% correct.

    I even had one young couple ask to be released from the remainder of their lease to move in with Mum and Dad to save a deposit. I readily agreed only to discover they put their returned deposit down on a new car on a lease contract costing most of the monthly rent saved.


    @ Lydia, there are exceptions, but they are very few and far between, as for us baby boomers having it easy when we were your age, you couldn't be more wrong.

  • icon
    • 30 September 2020 10:59 AM

    And indeed, they want everything NOW, and have no concept of saving and sacrifices.....!

  • icon
    • 30 September 2020 11:04 AM

    As more LL are driven out of business the young WON'T have anywhere to rent.
    They will be stuck at home with mum and dad.

    Great for labour mobility................NOT!!

    Many will be on the dole for years.

    Well done Govt you keep on destroying the PRS you know how beneficial it will be to the country as a whole..............NOT!

  • icon
    • 30 September 2020 11:08 AM

    Poor babies! My heart goes out to them. ;-)
    Why not get off their backsides and stop expecting Governments and Tax payers to pay for them.

    Now that is a thought I bet NEVER crossed their minds!!!!!!!!!

  • icon
    • 30 September 2020 11:49 AM

    I understand the Forces are recruiting.
    Wonder if the snowflakes will prefer the dole or possibly dying for their country!!

    Algarve  Investor

    In my experience, the biggest snowflakes are those who call others snowflakes. The likes of Morgan, Farage and Katie Hopkins who can give it out, but can't take it.

  • icon
    • 30 September 2020 13:00 PM

    @algarve You couldn't be more wrong if you tried!! Those you detailed are past nirmal combat age. Plenty of slovenly snowflakes who could join up and do something for their country rather than the country doing everything for their feckless selves. The Military is an excellent training organisation. You can work and when you leave you will have genuine qualifications. I cite my nephew who wasn't very academic. He joined the RAF as a driver though he couldn't drive!! He has now left. But there isn't anything he now can't drive or operate. His training cost thousands. He paid not a penny. He was forced to take risks driving petrol lorries into the Afghan desert for helicopter bases But hey free always cones with some sort of price. Snowflakes are just not prepared to do anything for themselves. They are the entitled generation who are a scourge on society. These are the types that consider it perfectly acceptable to default on rent and not vacate. 

  • Matthew Payne

    With the market closed for 3 months this year, and more recently FTBs the victims of lender's nervousness about the pandemic's effect on house prices, I wouldn't conclude that FTBs are losing their appetite for home ownership at all. In the main many have been prevented from buying this year which they have had no control over, and to a lesser degree many would have postponed their purchase having a few more nerves that seasoned actors in the market who have seen it all before. In context of only a 1% drop, I would say their desire is stronger than ever.

  • icon

    I don't think the young are frozen out of the market but have a great chance compared to the past if we want to talk about the past we have to keep thing in perspective. When I was young in the early 19 60's Houses were £2.5 / £3k in L'don, I was getting £ 15.00 take home pay so try buying the house on that after you paid for your room share, travel & feed yourself, its all relevant. A top trades person say Plumber, Electrician or a proper Carpenter for example was getting six and a penny halfpenny an hour (I suppose they'll need a calculator to work that out) and indeed they earned it. They usually made there own way to work with there own hand tools. There was no Electric tools whether saws or drills no such thing as cordless anything. I am glad I lived in a generation when we had to work and use our brains, no calculators we had the skills to plan, prepare and execute the job no problem. The trades people came with all the tools they needed usually in a box they had made themselves that they took pride in it and it looked like a suitcase. Today everyone has so many power tools they need a van to carry them around I won't bore you with the list the transformer is enough to weigh you down. Maybe more efficient now or not at all I remember back then a Carpenter would hang 8 doors in a day with an old penny joint all around proper workmanship, could they do this today not a hope ? just remember when you are ripping all those proper Houses apart the men that put them there were better that you. We had no Bank of Mam & Dad they had nothing themselves and we supported our parents, not other way around like now, no fast food, no Sky, Netflix, mobile phones, Computers, Credit Cards, ebikes no Internet of Course that's crippling the world doing away with the jobs that sustained the economy and go to Uni 10 years to learn it, which I remember is only to replace in the main what used to be the office job, of what used to be an poorly paid Clerk job, so now they are high & mighty in suits & shiny shoes jumped up up starts £60k / £70k remuneration, can any of them do a real job no, they just live off the backs of real workers who produce an end product. There was help to buy, Grants and loans free housing for the work shy or false Benefit Claimants with a load of children, people worked and save what they could and bought their home and didn't expect to be kept. There was no Obesity whatsoever in the 1960's if they are looking for a cure for Diabetics take a look back. Yes the young have it all & can't even be evicted either back then your case would be outside the door if you didn't pay your way.

    • 01 October 2020 02:15 AM

    If society would return to those halcyon days.

    Unfortunately the Permissive Society and bred fecklessness and a belief that everyone is entitled to what they want
    Neatly evidenced by Lydia.

    She is representative of these feckless types that will not accept MASS UNCONTROLLED IMMIGRATION has had massive negative effects on Society.

    She want to reside where she wants as the previous generation could so why not her.
    Just proves her feckless attitude.

    The attitude she should have is that what used to be affordable isn't.

    So what normal people do is look further afield accepting they can't afford the 'bright lights'; well boo-hoo!!

    Remove the 10 million EU immigrants who were never needed or wanted and watch the housing shortage disappear overnight.

    Snowflakes apoear not to unde


Please login to comment

MovePal MovePal MovePal
sign up