First-time buyer affordability has improved across nearly three-quarters of local authority areas in the UK over the past year, according to research from Nationwide Building Society.
The analysis shows that approximately 70% of council districts recorded improved affordability metrics during the period, though significant regional disparities persist.
Regional variations
Inverclyde, Burnley and Hartlepool emerged as the most affordable areas for first-time buyers, while Kensington and Chelsea, Oxford and Cambridge ranked as the least affordable.
The research found that the North has the smallest gap between least and most affordable areas, whilst London exhibits the largest disparity.
According to Nationwide’s data, a 10% deposit on a first-time buyer property ranges between £10,000 and £25,000 in more than half of local authorities.
Andrew Harvey, Senior Economist at Nationwide, stated: “London continues to have the greatest gap between the most and least affordable areas within the region by a considerable margin.”
He added: “Meanwhile, the North has the smallest difference between highest and lowest house price to earnings ratios (HPERs) by local authority area. The level of deposit required varies considerably by, and also within, region, reflecting differences in average house prices.”
Market response
Mary-Lou Press, President of NAEA Propertymark, commented: “This latest data highlights a mixed picture for first-time buyers across the country. It is positive to see affordability improving in many areas, with around 70% of local authorities recording progress over the past year, which should help support market activity.”
She noted that high house prices in London and the South East continue to create barriers, particularly regarding deposit savings. “The finding that a 10% deposit falls between £10,000 and £25,000 in over half of local authorities is encouraging, but many aspiring homeowners will still find it challenging to save amid wider financial pressures,” Press said.
Tom Bill, Head of UK Residential Research at Knight Frank, observed: “Affordability continues to shape the map of UK house price growth, with regional parts of the country having slowly narrowed the gap with London over the last decade.”
Bill added that buyers increasingly squeezed by prices in the capital have found more value in other parts of the country, facilitated by companies establishing regional operations.
Market implications
The data suggests a gradual rebalancing of the UK housing market, with regional areas becoming more competitive relative to traditional high-cost centres. However, the persistent affordability challenges in London and university cities indicate that geographical inequality in housing access remains a structural feature of the UK property market.