The cost challenge facing first-time buyers increased significantly over the past year with average purchase prices and deposits rising sharply, Halifax has found.
The average price paid by a first-time buyer in the UK last year was £231,455, up by 9% from a year earlier.
London saw the biggest monetary increase in the price paid by first-time buyers over the past 12 months, up by 7%.
Russell Galley, managing director at Halifax, said: “Whilst price growth in the overall housing market has been modest in recent years, the level of inflation facing first-time buyers is greater, which compounds the challenge in raising bigger deposits.
“However, given their importance to the market as a whole, it’s reassuring that the overall number of new buyers getting on the ladder remains stable.
“This is in part explained by initiatives designed specifically to support this key group, including Help to Buy schemes and family support mortgages, and they also benefit from the continued period of record low interest rates.
“However, it’s clear that more needs to be done to address more fundamental long-term issues, not least the shortage of new, affordable homes being built.”
The greatest percentage growth came in the North West and Yorkshire and Humber, both up by 9%.
The smallest increase was in East Anglia, up by just £4,528 (2%).