The ultimate London guide for first-time buyers

From new-builds to no-deposit mortgages, how to make the most of lower prices.

- By Anna White

The price of a flat in London is at its lowest since Covid-19 swept across the UK and the housing market was forcibly shut. First-time buyers have returned in earnest to the home sales market this January, taking advantage of these discounted prices, falling interest rates — the Bank of England reduced the base rate from four to 3.75 per cent in December - and an increase in high loan-to-value mortgages. Land Registry data shows the average price of a flat in the capital has fallen 10 per cent since its peak in September 2022 and now sits at £427,689. The last time a flat was cheaper was in May 2020, when the homes sales sector had just reopened, having been closed for six weeks at the start of the pandemic.

“The market feels noticeably more vibrant than it did this time last year,” says Eva Bouzaki, manager of Stow Brothers in Hackney. “The interest rate cut clearly had a positive impact on affordability. We are seeing more viewing inquiries from first-time buyers, increased new buyer registrations and busy viewing days. We are selling a one-bedroom flat in a period building in London Fields for £550,000 and have conducted 32 viewings so far this month.” Her colleague Joseph Earnshaw in Walthamstow agrees: “There was a noticeable slowdown in activity last year due to the Budget and stamp duty rumours. Many first-time buyers adopted a wait-and-see approach. With no changes introduced at this level and the interest rate cut, they are now returning in greater numbers with lots of viewings of flats.”

The right time to shop around

At the start of last year there was a spike in first-time buyer purchasers as stamp duty relief ended. Young buyers pushed to complete deals in the first few months of 2025 to benefit from the outgoing scheme. Since then the price of a flat has slipped month-on-month.