The Changing Profile Of First-Time Buyers

The age of first-time buyers has shifted up the scale over the past twenty years, according to the most recent English Housing Survey. While the average age only crept up two years, to 32, a larger change has occurred in the share of different age groups. The proportion of first-time buyers between ages 16-24 has plummeted from 21.3% to 7.5%, while 35-44 year olds now make up 20.9% of the first-time buyer population, up from 16%.


Age of first-time buyers
Source : English Housing Survey


A number of factors are driving these changes. It could be in part due to more people going to university and leaving with significant student debt. Real income growth has been weak. Of course, house price growth in some regions has also rapidly outpaced the increase in average incomes. Taken together, many people must wait until the are older before they buy their first home.

Looking at incomes is also instructive. How much you earn is unsurprisingly a determining factor in who can become a homeowner. More concerning is that homeowners are again becoming concentrated in higher income groups. The data shows that two thirds of first-time buyers were in the two highest income bands in 2016/2016. This figure dropped from 62% to 58% between 1995/96 and 2005/06 but shot back up over the last ten years.

First-time buyer incomes
Source : English Housing Survey


Ever more important for those aspiring to get onto the housing ladder is the need to find a soulmate.  In 2015/16, three quarters (74%) of first time buyers were couple households, a marked change since 2006/06 (66%). Not good news for all the singletons out there – especially for women who make up less than a third of first-time buyers.

Elsewhere the data shows that the ‘Bank of Mum and Dad’ gaining in influence – though perhaps not in the magnitude that various housing marketing commentators have argued. 29% of people had help with the deposit from family and friends – compared to 22% twenty years ago.

While the desire to own a home remains strong in renters, raising a deposit is still the biggest barrier. The Survey asks people who report they had been considering applying for a mortgage why they did not do so. Almost half said they didn’t think they has a big enough deposit – far and away the most cited reason, which accords with the findings of the BSA’s quarterly Property Tracker survey.


Reasons for not applying for a mortgage, 2015-16
Source : English Housing Survey


There we have it – first-time buyers are now older, earn more, and are more likely to be in a couple, but many are still reliant on help from their loved ones. The past decade has seen significant Government support for home ownership – not least in policies such as Help to Buy. Without that support, these trends may well have become even more conspicuous. Now with the Government focusing on supply and widening out its support to a range of tenures through the Housing White Paper, we will see what effect these measures have on the profile of first-time buyers in coming years.

Posted by Charlie Blagbrough on 31 July 2017.


At The Hanley Economic Building Society, we offer free mortgage advice, call us on 01782 255000 or visit us at one of our branches for more information on how we can help you.

Repossession notice
Hanley Economic Building Society is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 206024

Featured Financial Planning Mortgages


About the Author BSA
The Building Societies Association are the trade body of the Building Society sector.

Blog Index