Trends, Challenges, and Potential Solutions for a First-Time Buyer

a first time buyer

Recently, the UK has seen an unprecedented shift in homeownership trends among the younger generations – specifically Millennials and Gen Z. Both generations face obstacles like rising house prices, stagnant wages, and difficulty in securing mortgages that prevent them from purchasing their own properties.


As a first-time buyer, the younger generations such as millennials and Gen Z are grappling with their homeownership future. They are increasingly having to deal with the stress over the fact that buying their first home may seem unattainable. This is due to rising home prices, student loan debt and other financial obstacles. 


In this article, we will examine trends and challenges young adults are experiencing when entering the housing market for the first time and potential solutions that could provide relief.


Trends of First-Time Buyer Homeownership among Millennials and Gen Z


Decrease in Homeownership Rates


According to recent studies, millennials and Gen Z are less likely to own their own homes than the generations before them. Only 35% of those between the ages of 25-34 owned their own home in 2018 compared to 55% in 2006. This trend is expected to continue, and researchers predict that by 2025, only one in four millennials will own their own home.


Soaring House Prices


One significant factor contributing to this decline is the increasingly unaffordable cost of housing in some parts of the country, particularly London and the southeast. This has made it difficult for first-time buyers to get on the property ladder, especially when combined with minimal wage growth. 


Popularity of Rentals


Because of the not-so-welcoming housing market, rental properties have become increasingly popular. Many are opting for long-term rentals in urban areas, particularly those that offer flexible renting options, such as lease agreements that allow tenants to rent on a rolling basis.


Over the past few years, there have been significant shifts in UK homeownership trends among younger generations. Factors such as rising house prices and a preference for flexibility have made it more difficult for millennials and Gen Z to own their own homes. 

However, there are still opportunities for younger generations to become homeowners through new schemes and shared ownership programs that may emerge in the future.


Challenges Facing Millennials and Gen Z in the Housing Market


Millennials and Gen Z, which make up a substantial portion of the current UK housing market, face unique obstacles when it comes to first-time buying. We will explore these difficulties here. 

Rising Costs

One of the main hurdles a first-time buyer will face in the UK housing market is the rising costs associated with homeownership. According to data from the UK House Price Index, in February 2023 the average UK house price stood at £254,606, an increase of 7.8% year-on-year. Meaning homes are becoming increasingly unaffordable for many young Britons.


Several factors, such as limited housing supply, low-interest rates and rising demand drive this increase. Many millennials and Gen Zers are finding it increasingly challenging to save up for down payments or qualify for mortgage loans.

Student Debt

Another obstacle facing first-time buyers entering the housing market is student debt, according to The Student Loans Company in England the average graduate debt stood at £36,752 as of 2022 – making saving for down payments harder and qualifying for mortgages more challenging.


Additionally, the current system of student loans in the UK means that many young people carry debt well into their 30s – further delaying their ability to enter the housing market.


Young Britons may also face discrimination in the housing market. According to a 2021 report by Shelter, one out of every three renters under 35 who experienced discrimination when looking for accommodation has encountered some form of harassment in finding suitable lodgings. Such as being denied access, having higher rent or deposits assessed or receiving less favourable tenancy agreements than expected.


Discrimination in the housing market can have devastating repercussions for certain groups, particularly Black and Minority Ethnic (BME) individuals who may face additional obstacles when seeking a place to reside.


Potential Solutions for Younger Generations


Although these challenges present many obstacles for first-time buyers, there are various potential solutions that could assist them in fulfilling their homeownership dreams. One potential approach would be creating more affordable housing, including tiny houses or cohousing communities which may be more suitable to young people’s budgets.


Another approach would be to address the student loan debt crisis directly. This could involve offering loan forgiveness or other forms of relief to those carrying high amounts of student loan debt; furthermore, more efforts could be undertaken to make college more cost-effective overall.


Finally, greater efforts could be taken to address discrimination in the housing market. This might involve increasing education and awareness about fair housing laws and strengthening enforcement efforts against them.




The future of homeownership for first-time buyers deserves careful consideration. While there may be challenges associated with buying homes for these younger generations, solutions exist that could make homeownership more attainable. By addressing issues such as affordability, student loan debt and discrimination in housing markets, younger generations have every chance at realizing homeownership goals.


For more expert advice, independent mortgage brokers such as Eden Hawk Financial Solutions, offer comprehensive guidance to first-time buyers as they make their way up the property ladder.

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