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As many as 426,000 fewer first-time buyers in England could get on the property ladder between this year and 2027 compared with the long-term average, a building society has predicted.

Leeds Building Society, in partnership with specialist advisers WPI Strategy, analysed first-time buyer affordability between 1982 and 2022, and how the challenges of buying a first home have changed.

Economic data was used to model what the future could hold.

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The report made projections for the number of first-time buyers in England in the years from 2023 to 2027 and compared this with the average number of people getting on the property ladder over the 40 years between 1982 and 2022.

Cumulatively, over the five-year forecast period, and when set against a 40-year average of 340,000 first-time buyer transactions, 426,000 fewer first-time buyers will be able to join the housing ladder at the current trajectory, without intervention, the report predicted.

There have recently been signs of house prices falling back, and the report forecasts a gradual improvement for first-time buyers in England from 2023 until 2027.

But it said mortgage interest rates for first-time buyers are forecast to fall only slowly and the cash deposits typically required will remain relatively high.

Richard Fearon, chief executive of Leeds Building Society, said previously low interest rates “have papered over the cracks in the housing market”.

He added: “It has masked a growing gap between people with the ability, or family help, to build ever higher deposits and stretch their repayments and those who cannot.”

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