For the second year running, Glasgow was the best city for first-time buyers (FTBs), Aldermore’s First-Time Buyer Appeal Index has revealed.
There was a regional divide in homebuying opportunity, with the index dominated by cities in Scotland and the North West of England, while the South trailed behind.
Scottish cities continued to occupy the top spots in the index, offering the strongest opportunities for first-time buyers.
Glasgow had an average first-time property price of £158,310 and a projected annual increase of 7% in the coming years.
Edinburgh fared less well than other Scottish cities in the Index, falling from 5th place in 2022 to 10th place.
The city scored well in terms of the lifestyle pillar – with 26% of the population aged between 25 to 35 and a large graduate workforce (69%) indicating social life and employment opportunities.
However, property prices were much higher, at an average of £268,562, and the amount needed for a deposit was £67,224 compared with the average FTB deposit in Glasgow of £32,385.
Manchester jumped from 11th to 4th place, meeting a number of lifestyle considerations, including competitive salaries, at £33,784 on average.
Although the average price was lower than other cities (£218,503), properties offered good returns, with an annual house price increase of 6.8% projected.
Liverpool boasted an affordable stock of properties (£163,108 on average) and healthy projected price growth per year (7.2%).
Although the average purchase price in Newcastle was more affordable (£168,442) than other cities featured in the index, house prices increased at a much lower projected rate per annum (4.1%) compared to Swansea (6.7%) and Newport (7.4%).
Swansea and Newport held their positions of 7th and 9th, respectively. Derby climbed into the top 10, in 8th place.
Southern cities in the UK failed make this year’s top 10 for the second year in a row.
This was largely due to a lack of affordable property for first-time buyers, with Maidstone, Chelmsford and Basildon remaining the least attractive cities.
London dropped one place to 43rd, continuing to sit low in the rankings due to high house prices, unaffordable deposit requirements and its limited potential for house price growth.
Cities in Yorkshire were rising stars, with Wakefield making the highest jump this year from 32nd place in 2022 to 14th place.
Leeds took the 13th spot, with Doncaster (26th), Sheffield (27th) and Barnsley (28th) also making the top 50.
Jon Cooper, head of mortgages at Aldermore said: “First-time buyers have had a challenging year, facing higher interest rates and increased market uncertainty.
“It’s therefore understandable that some people are questioning whether or not to put their homebuying plans on the backburner.
“However, as we can see, there are still fantastic opportunities available in the UK, with many regions not only offering healthy returns on properties but are also fulfilling key lifestyle considerations, which for some, is just as important in the homebuying search.
“Becoming a homeowner is a wonderful step forward in a person’s life, and for many is a rite of passage. Despite the current environment, first time buyers can still realise their homebuying dreams.”
