The number of first-time buyers exceeded the 400,000 mark in 2021, according to Yorkshire Building Society.

Despite the pandemic, latest estimates suggest the number of first-time buyer transactions reached 408,379 during the year, which is a 35% increase on 2020 (303,000).

The mutual added that first-time buyers now represent 50% of all house purchases with a mortgage, up from 36% in 2007.

The previous first-time buyer peak was in 2002, when 531,800 took their first step on to the housing ladder and you need to go back 15 years to see transactions topping 400,000, back in 2006.

Why the rise in first-time buyer purchases?

Falling unemployment, low borrowing costs and an increased number of low deposit mortgage deals are key drivers of current demand, said Yorkshire Building Society.

It added that new buyers have not been deterred by the price of a typical first-time buyer home which has increased by 9% to £222,997 in the year to October, up from £204,230 a year earlier.

Nitesh Patel, strategic economist at the Society, said: “The performance of the first-time buyer market in 2021 has been extraordinary, particularly against the backdrop of uncertainties caused by the lockdown in the early months of the year.

“There are some strong drivers of demand that explain the increased volumes. Low borrowing costs is an important factor and the increased availability of more low deposit mortgages has also been an enabler mostly for first-time buyers. Unemployment has also been falling for the last year and the jobs market has been getting stronger since the phased re-opening in April.

“Whilst first-time buyers don’t pay stamp duty on prices up to £300,000, new buyers looking to buy up to £500,000 would have benefited.

“In the near-term housing demand will continue to exceed supply, however with prices at an elevated level in comparison to local earnings, this should dampen activity. Therefore, it’s unlikely that we will continue to see first-time buyer numbers at this level in 2022 and beyond.”