First-time buyer demand softened during the third quarter, according to new research from Yopa.
The estate agency found that 31.7% of properties it classifies as suitable for first-time buyers had sold subject to contract in Q3.
That was down from 32.9% in the previous quarter, a fall of 1.3 percentage points. Demand was also 0.6 percentage points lower than in Q3 2025.
The findings come as the government prepares to introduce a new equity loan scheme for first-time buyers.
Your First Home is expected to allow eligible buyers in England to purchase a new-build home with a 2.5% deposit. A 20% government-backed equity loan would support the purchase.
However, Yopa argues that boosting demand addresses only part of the problem.
Its research suggests suitable properties account for just 1.8% of homes currently listed for sale across Great Britain.
That was slightly higher than the 1.7% recorded in Q2. However, the figure was unchanged year-on-year.
Yopa based its definition of suitable stock on properties marketed with the aid of a buying scheme. The figure therefore does not cover every home a first-time buyer could potentially afford.
Demand varies across Britain
Liverpool recorded the highest level of first-time buyer demand among the locations analysed. Some 51% of suitable properties had already found buyers in Q3.
Sheffield followed at 44.7%, while Leicester recorded 44.6%. Bournemouth stood at 41.7% and Manchester at 41.1%.
Leicester recorded the largest quarterly increase. Demand rose by 7.1 percentage points, from 37.5% to 44.6%.
Manchester saw an increase of 3.3 percentage points. Portsmouth rose by 2.4 points to 23.2%.
The availability of suitable stock also varied significantly by location.
Plymouth recorded the highest proportion, at 2.1% of homes for sale. Southampton followed at 2%, ahead of Portsmouth at 1.9% and London at 1.8%.
Yopa chief executive Verona Frankish said: “While we’ve seen first-time buyer demand ease slightly at a national level during the third quarter, the underlying picture remains mixed, with a number of regional markets continuing to demonstrate strong levels of buyer activity.
“The fact that demand remains strong in cities such as Liverpool, Sheffield, Leicester and Manchester demonstrates that many first-time buyers are still actively looking to enter the market when the right opportunities are available. At the same time, the significant variation between markets highlights that the experience of first-time buyers continues to differ considerably depending on where they are looking.
“However, one of the biggest challenges continues to be the lack of suitable stock. Across Britain, first-time buyer homes account for only a very small proportion of all properties available for sale. While there has been a slight improvement in availability this quarter, increasing the supply of suitable homes remains essential if we want to improve accessibility and maintain market momentum over the longer term.
“The government’s proposed new first-time buyer scheme could certainly help to reduce the upfront deposit barrier for some buyers, but there is also a risk that stimulating demand specifically within the new-build market could artificially inflate prices. If that happens, some first-time buyers could find themselves more exposed to negative equity further down the line, particularly if those price gains prove difficult to sustain.”
