Is Now Finally the Right Time for First-Time Buyers to Get on the Property Ladder?

For years, first-time buyers have been told the same story: house prices are too high, deposits are impossible to save, and the banks aren't playing ball. And for a long time, that story was largely true. But something has quietly shifted in the past twelve months — and if you're sitting on the sidelines waiting for the "perfect moment", you need to read this carefully, because that moment may be closer than you think.

I'm not here to tell you to blindly rush into the biggest financial decision of your life. What I am going to do is lay out the facts, cite the data, and let you make an informed decision.

The Deposit Barrier Is Being Dismantled

The single biggest obstacle stopping first-time buyers from purchasing has never been the monthly mortgage payment — it's been scraping together the deposit in the first place. According to a survey of 2,104 adults by the Building Societies Association (BSA) in January 2026, 64% of respondents cited raising a deposit as the biggest barrier to buying a home.

Banks have heard that message. In February 2026, Santander — which holds a 10% share of the UK mortgage market — launched a 98% loan-to-value mortgage. That means a buyer needs just a £10,000 minimum deposit to borrow up to £500,000, at a maximum of 4.45 times their salary. The rate sits at 5.19% on a five-year fix with no fee and £250 cashback (Source: The Times, February 2026).

And Santander is far from alone. Newcastle and Yorkshire Building Societies now offer deals requiring deposits as low as £5,000. Skipton Building Society and April Mortgages offer products requiring no deposit at all on some deals. According to Moneyfacts, there were 23 mortgage deals available above 95% loan-to-value in January 2026, up from just 16 in January 2025. The direction of travel is unmistakable.

Lenders Are Letting You Borrow More

Four of the six largest high street lenders — Barclays, HSBC, Nationwide, and NatWest — now allow borrowers to take out at least six times their salary. The Bank of England had previously capped high-leverage lending, with a 2016 rule restricting mortgages above 4.5 times income to just 15% of a lender's yearly book. Last July, the Bank began a formal review of that cap and, while it continues, lenders can apply to exceed it — and they are.

For a household earning a combined £60,000, borrowing at six times salary means access to a £360,000 mortgage. A year ago, at 4.5 times, that same household could only borrow £270,000. That difference can mean the gap between renting forever and owning your own home.

More Choice Than Any Point in Eight Years

According to Zoopla's January 2026 House Price Index, the average estate agent is currently marketing 34 properties — the highest level seen since 2018. The total number of homes for sale is 6% higher than this time last year.

According to analysis from Alan Batt Sales & Lettings, property stock levels at the end of 2025 were at their highest point since November 2013, sitting 21% above the 2020–2025 average. That is a buyers' market by any definition. More supply means more negotiating power. Sellers are competing for your attention, not the other way around.

Prices Affordable Relative to Income — For the First Time in Years

Halifax has stated that the house price-to-income ratio was at its lowest level in over a decade in December 2025. Nationwide's chief economist Rob Gardner confirmed that with price growth running well below the rate of earnings growth and mortgage rates falling, "affordability constraints eased somewhat, helping to underpin buyer demand." He also noted that "the first-time buyer share of house purchase activity was above the long-run average, supported by easier credit availability"

In 2025, approximately 390,000 first-time buyers entered the market — the highest number in over a decade — and they accounted for two in every five sales, borrowing a record £82.8 billion in mortgage debt Mortgage Rates Are Falling — and Expected to Fall Further

The Bank of England cut the base rate four times in 2025, bringing it down from 5.25% at its peak to 3.75% by December — the first time it had dropped below 4% since early 2023. Average two-year fixed rates fell from 5.06% at the start of 2025 to 4.31% by year-end. Five-year fixes dropped from 4.82% to 4.39%

Zoopla confirms that mortgage rates are now at their lowest level since 2022. Further cuts are expected in 2026 — markets are pricing in at least one more Bank of England reduction, likely mid-year.

What About Inner London? The Opportunity Is Real

Inner London house prices fell by 4.6% in 2025 — the biggest annual drop since 2008, according to official ONS data published in February 2026. The prime market has been hit by higher mortgage rates, the so-called "mansion tax" (a high-value council tax surcharge on properties worth over £2 million from 2028), and non-domiciled residents relocating overseas following tax reform. For first-time buyers who have always assumed London is permanently out of reach — look again.

A Word of Caution

James Daley of consumer group Fairer Finance has warned that "the solution cannot be simply to offer ever larger loans with lower deposits." He argues that the safeguards put in place after the 2008 financial crisis have kept repossessions low and negative equity rare — and that unwinding them in pursuit of short-term political goals is short-sighted.

He has a point. A 98% mortgage leaves almost no buffer if prices dip. My view? The risk of negative equity is real but manageable if you're buying a home you intend to live in for the long term, in an area with strong fundamentals. If you're stretching to the absolute limit of what a lender will offer, think carefully. But if you have a stable income, a secure job, and you've been waiting because you couldn't save a £30,000 deposit — the market has just moved in your favour.

The Bottom Line

The conditions for first-time buyers in early 2026 are the most favourable they have been in a decade: deposits are lower, borrowing limits are higher, stock levels are the best in eight years, mortgage rates are falling, and house prices relative to income are at a ten-year low. Banks are innovating to win your business. The government wants you buying homes.

None of this means you should rush in recklessly. It means you should stop assuming it's impossible and start having proper conversations with a broker, an independent financial adviser, and someone who knows the local market. The window may not stay open for long.