First-time buyer (FTB) mortgage transactions are expected to total 390,324 in 2025, the second highest level in the last decade, Yorkshire Building Society has predicted.

The building society’s latest figure is an 18% year-on-year increase and close to the post-COVID peak of 405,250 in 2022, which was driven by "unprecedented Government support", increased demand due to remote working and historically low interest rates.

Yorkshire Building Society stated that its 2025 FTB transactions forecast reflects improving affordability due to regulatory changes, industry innovation and falling interest rates.

The number of house purchases completed with mortgages is also expected to have risen by 16% to 717,588 in 2025, from 619,120 in 2024; driven largely by FTBs, who make up 54% of that total.

Official figures will be published in February by UK Finance, but The Yorkshire said that trends up to October point to a strong end to the year, with the value of FTB completions expected to increase by 22% year-on-year to £84.9bn in 2025.

Despite this increase, the society’s group economist, Max Shepherd, warned that more needs to be done to avoid a growing divide between those who are managing to buy and those who still can’t.

Shepherd concluded: "FTBs have shown remarkable resilience despite high living costs, market volatility, the end of stamp duty incentives and elevated house prices. Tailwinds like real earnings growth, lower mortgage rates, and regulatory changes allowing lenders lend borrowers more times their income are helping more people onto the ladder.

"But we must keep momentum going. We know how important the prospect of owning their own home is to people, yet many still struggle to save a deposit or meet affordability checks. We don’t want to see a growing divide between the ‘haves’ and ‘have-nots’ when it comes to homeownership."

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