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The number of first-time buyers in Scotland reached 34,519 in 2018, an increase of 56 per cent from 22,100 a decade ago, according to recent data from Bank of Scotland.

First-time buyers account for 50 per cent of all house purchases with a mortgage in Scotland, which is up from 37 per cent in 2008, while the average price paid for a typical first home has gone up 19 per cent from £119,402 in 2008 to £141,671 in 2018, according to the recent data from Bank of Scotland.

Meanwhile, the average deposit value has increased by 11 per cent over the same period 10 year period, increasing from £17,910 in 2008 to £19,952 in 2018.

Knight Knox – MPU

While the figures were up on the long-term, the number of first-time buyers in Scotland dropped slightly over the last 12 months from a peak of 35,100 in 2017; the highest recorded figure over the decade. The lowest number of first-time buyers in Scotland in the last decade was 16,700 in 2011, according to the rent data from Bank of Scotland.

In terms of the average deposit put down by a first-time buyer in Scotland, this was 15 per cent of the purchase price in 2008, increasing dramatically to 25 per cent in 2009. In 2018, the average deposit has dropped to 14 per cent of the purchase price; however, the average property price has continued to increase, according to Bank of Scotland.

Lower than the UK-average

The £19,952 average deposit put down on a first home in Scotland is just over half of the UK-wide average of £33,352 while those in Wales are paying the lowest average deposit of £16,701, according to the recent data from Bank of Scotland.

In terms of first-time buyers’ homes of choice in Scotland, two-bedroom properties have been the most popular over the last decade. This property type has made up over 40 per cent of mortgages for first homes in 2018, according to Bank of Scotland.

A steady growth of new buyers

Ricky Diggins, director, Bank of Scotland, commented: “There has been steady growth of new buyers coming on to the property ladder in Scotland over the last decade, with the proportion of first-time buyers now representing half of the overall market. This is important for the wellbeing of the Scottish property market, and has been helped by factors such as continued low mortgage rates.”

Diggins added that with a much lower deposit required north of the border, first-time buyers in Scotland will have to put down a lot less to get the keys to their first home, especially those in East Ayrshire, which is the UK’s most affordable place for first-time buyers.

He also pointed out, however, that those looking for their first place in Edinburgh can expect to pay more than double that of buyers in the East Ayrshire region.

First-time buyer affordability

For those considering buying their first home in Scotland, the most affordable local authority district (LAD) is in East Ayrshire where first homes sell for an average of just £94,376. This is three times the local gross average annual earnings and is closely followed by Inverclyde and South Ayrshire.

The least affordable local authority district in Scotland is Midlothian, which has an average property price of £168,898. This is 5.3 times the average gross annual earnings. Meanwhile, the highest average price for those taking their first step on the property ladder is in Edinburgh, with an average property price of £196,091; 4.8 times the average gross annual earnings.

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Jim Kersey
Jim focuses on the socio-economic impact of housing. His reporting for Property Notify often touches on topics such as changes in sentiment among investors in various housing sectors, as well as the impact of various developments on the average person.

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