First-time buyers are set to make up 40% of the mortgage market in 2024, which is a 25% activity increase over the past eight years, Yorkshire Building Society has revealed.

Analysis of CACI data bythe society found that first-time buyers are now making up a high proportion of the home purchase market than at any time since the business consultancy began measuring these market statistics in 2016.

Yorkshire Building Society has seen overall mortgage applications rise by almost a quarter in 2024, despite UK Finance forecasting that gross lending would be lower in 2024 compared to last year.

The data suggested that the value of mortgage applications in the year-to-date is 15% higher than the equivalent period in 2023, while first-time buyers applications jumped by 33% year-on-year.

Furthermore, the analysis has also shown that the proportion of mortgage applications for first-time buyers overtook home movers, for the first time in January.

Director of mortgage distribution at Yorkshire Building Society, Jeremy Duncombe, said: "Things have changed substantially since UK Finance issued its forecasts last November. The picture is a fast-changing one, and despite continued inflationary pressures keeping interest rates higher than hoped; coupled with ongoing volatility caused by economic and political uncertainty, consumer confidence seems to be returning.

"While there is continued uncertainty and it’s therefore important to be cautious, the year has got off to a far better start than predicted, with housing market activity on the rise. House prices are predicted to settle and maybe even increase moderately throughout the rest of the year, with more stable mortgage rates resulting in more buyers deciding to dip their toes back in.

"The increase in first-time purchaser numbers could be attributed to a number of factors. We know from our own research that many are making life-changing decisions to prioritise homeownership over other milestones like starting a family. High rental costs are making the prospect of owning a property more appealing and many may feel they’re just not prepared to put off buying any more in the hope rates might reduce."

---