Mortgage lenders advanced a record £82.8bn of mortgage debt to around 390,000 first-time buyers in the year to September 2025, according to analysis by Savills.
This represents a 30% increase on the previous year and means first-time buyers accounted for 20% of all spending in the UK housing market over the period, the highest proportion since at least 2007.
Savills said the increase was partly driven by a surge in activity ahead of the end of the stamp duty holiday earlier in the year, alongside improving affordability conditions.
Lucian Cook, head of residential research at Savills, said: “Record lending to first-time buyers partly reflects the rush to get things through prior to the end of the stamp duty holiday earlier in the year.
“At the same time, homeownership is more accessible now than at any point in the last three years, thanks to lower borrowing costs, lower real house prices, and more accessible mortgage debt.
“The FCA’s revised guidance on interpretation of mortgage regulation back in March, in particular, gave lenders more latitude to lend at higher loan to income and loan to value ratios, to the benefit of first-time buyers.”
The analysis shows the total size of the UK housing market grew by 14% to £417bn in the year to September.
Despite the increase, total spending remains well below the £521bn peak recorded in the year to September 2021 during the post-lockdown housing boom.
Cook said further momentum could build into next year. He added: “Further interest rate cuts expected later this year are likely to broaden the pool of prospective buyers entering the market in 2026.
“The continued shortage of rental properties is set to keep first-time buyer demand strong going into the new year.
“Meanwhile, existing mortgage holders seeking to move home are also expected to become gradually more active, with falling rates enabling them to take on slightly larger loans and increase their budgets.”
Savills’ analysis also highlights a gradual shift in the balance between mortgage borrowing and deposits among first-time buyers.
Total deposits from this group amounted to £21.8bn in the year to September 2025, below the £25.9bn peak recorded in 2021.
Cash buyers continued to account for the largest share of the market, with an estimated 397,000 purchasers spending £147.6bn, although this figure fell by 3% over the year.
