Housing markets with largest first-time buyer discounts revealed

Elmbridge in Surrey and Brentwood in Essex have been named as the parts of Britain with the largest discounts for first-time buyers compared with typical headline house prices.

Estate agency brand Yopa analysed House Price Index data, comparing the average price paid by first-time buyers with that paid by former owner-occupiers across Britain.

Across Britain as a whole, the average first-time buyer is currently purchasing at £229,107, £106,245 less than the £335,352 average paid by former owner-occupiers.

It means that the average first-time buyer purchase price sits 31.7% below that of an existing homeowner moving up the ladder.

Headline house prices don’t necessarily tell the full story for those looking to buy their first home.”

At a regional level, the South East is home to the largest first-time buyer house price discount. The average first-time buyer purchase comes in at £300,540, 36.7% below the £475,135 paid by former owner-occupiers, a difference of £174,595.

Scotland ranks second, with the average first-time buyer price sitting 34.8% below that paid by former owner-occupiers, followed by London at 32.3%.

However, London boasts the largest difference in pounds and pence, with first-time buyers paying an average of £471,629, some £224,981 less than the £696,610 average paid by former owner-occupiers.

The East of England also sees first-time buyers purchase at an average of 32% less, followed by the South West at 31.1%, West Midlands at 30.1%, Wales at 28.1%, North West at 27.8%, East Midlands at 27.6%, Yorkshire and the Humber at 27.3% and North East at 26.7%.

Deepest discounts

However, at the local authority level, Elmbridge is home to the largest first-time buyer house price discount.

The average first-time buyer in Elmbridge is purchasing at £500,171, compared with an average of £948,215 amongst former owner-occupiers.

That’s a difference of £448,044, with the average first-time buyer purchase price sitting 47.3% lower.

Brentwood ranks second, where the average first-time buyer price of £369,662 is 45.5% below the £677,883 paid by former owner-occupiers, a difference of £308,221.

Tandridge completes the top three. First-time buyers are purchasing at an average of £330,149 versus £602,277 for former owner-occupiers, a difference of £272,128, or 45.2%.

Mole Valley also ranks among the markets with the largest first-time buyer house price discount, with the average first-time buyer purchase price sitting 44.7% below that paid by former owner-occupiers.

Surrey Heath ranks fifth with a 42.7% difference, followed by Three Rivers at 42.6%, Woking at 42.4%, Guildford at 42.4%, East Hampshire at 42.3%, and Waverley at 42.1%.

Financial challenge

Verona Frankish (pictured), Chief Executive of Yopa, says: “Getting that first foot on the property ladder remains one of the biggest financial challenges many people will face and higher mortgage rates in recent years have certainly made that task more difficult.

“However, headline house prices don’t necessarily tell the full story for those looking to buy their first home, as first-time buyers generally enter the market at a very different price point to those who are already on the ladder.

“Our research shows that this difference is substantial, with the average first-time buyer across Great Britain purchasing for more than £100,000 less than a former owner-occupier and, in some areas, the gap is considerably wider.”

Frankish highlights that a larger first-time buyer discount doesn’t necessarily make an area more affordable.

She adds: “Elmbridge is a prime example, where the average first-time buyer is still paying more than £500,000 despite purchasing at a substantially lower price point than existing homeowners.

“What it does demonstrate is that first-time buyers are generally entering at a different point of their local property market, targeting homes that suit both their needs and their budgets, while those already on the ladder are often purchasing further up it.

“For aspiring homeowners, this is an important distinction. The headline cost of property within a particular area can often look daunting, but understanding what first-time buyers are actually paying provides a far more realistic benchmark when considering that first step onto the ladder.”