First-time buyer demand falls as stock shortage persists

First-time buyer demand across Britain declined in the second quarter of 2026, according to new research from estate agency brand Yopa, which analysed properties listed under government and industry schemes.

The data shows that 32.9% of first-time buyer suitable homes had sold subject to contract between April and June 2026, down from 34.8% in the first quarter. On an annual basis, demand remained relatively stable, sitting just 0.2 percentage points below the level recorded in Q2 2025.

Regional variations

Swansea recorded the largest quarterly increase, with the proportion of suitable homes sold subject to contract rising from 7.7% in Q1 to 40% in Q2. Liverpool saw demand increase by 24 percentage points to 60.8%, whilst Edinburgh experienced a 14.7 percentage point rise to 69.2%.

Bournemouth and Sheffield also posted notable quarterly improvements, with demand increasing by 11.5 and 8.5 percentage points respectively.

Edinburgh currently shows the strongest level of first-time buyer demand overall at 69.2%, followed by Liverpool at 60.8% and Bristol at 50.5%. Sheffield and Bournemouth both recorded demand levels of 50%.

Supply constraints

The research highlights ongoing stock shortages, with first-time buyer suitable properties accounting for just 1.7% of all homes currently listed for sale across Britain, down from 2.1% in the first quarter of 2026. This supply constraint continues to affect market accessibility, a challenge that has broader implications for housing delivery targets across the sector.

Verona Frankish, Chief Executive of Yopa, noted: “While we’ve seen first-time buyer demand ease slightly at a national level during the second quarter, the underlying picture remains encouraging, particularly across a number of regional markets where buyer appetite has strengthened considerably.”

She added: “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 and increasing supply remains essential if we want to improve accessibility and maintain market momentum over the longer term.”

The supply shortage affecting first-time buyers comes as landlords increasingly focus on portfolio expansion, potentially competing for similar entry-level stock. Meanwhile, development finance continues to support new housing projects, though the volume of first-time buyer specific properties remains limited relative to overall market demand.