Last month the proportion of sales to fledgling buyers stood at its lowest since May 2013 as a combination of market forces and regulatory conditions made it difficult for buyers to get a foothold on the housing ladder.

Mark Hayward, managing director of the National Association of Estate Agents, said: “Things are getting even tougher for first-time buyers.

“Not only do you now need to stump up ridiculously large sums of money in terms of deposits and stamp duty to be able to get on the ladder, but new rules mean buyers will also have to prove they can easily afford repayments now and in the future.”

Colin Chapman, director of Harlow-based broker Genesis, said the drop off in numbers is not because there is a lack of interest from first-time buyers. He said there is a considerable amount of pent-up demand from this type of borrower.

Borrowers are having to realign their expectations as prices continue to rocket, he said.

Despite a decline in house prices for four consecutive months since December, prices in the three month period to June were still 8.8% higher than the same period a year ago according to the Halifax House Price Index. The index revealed that the average house price was now £183,462.

Chapman said: “In Harlow a house which was worth £135,000 in October last year would now be valued at £170,000. That’s a huge uplift in such a short space of time.”

Wage inflation has not kept pace with house price inflation making it difficult to save for and service property payments. But uncertainty over job security is making buyers nervous about taking on a long-term commitment.

In a workplace survey carried out last week by career experts Glassdoor 46% of younger employees – those aged between 16 and 24 – said they were concerned they could be laid off.

Speaking on Coreco’s London Calling podcast, Paul Broadhead head of mortgage policy at the Building Societies Association spoke specifically of the fears shared by first-time buyers.

“There’s a nervousness among first-time buyers in particular. They want to buy but potential job insecurity, the likelihood of rates rising and the fear lenders aren’t lending are all factors,” he said.

“The message is go to speak to a lender to find out where you stand.”

Chapman said that market forces are having a much greater impact on first-time buyers’ access to property than the new affordability rules which came into force under the Mortgage Market Review.

But he added this could play a bigger role as lenders’ move to tighten criteria even further.

Santander for Intermediaries today announced its plans to restrict all Help to Buy mortgage indemnity guarantee applications to less than four-and-a-half times borrowers’ income and made changes to is affordability calculator.

Click HERE to listen to Coreco’s London Calling monthly news and views podcast.