First-time buyers stretch to buy ‘forever homes’ and opt for longer mortgages, Barclays data shows

First-time buyers in the UK are increasingly buying larger homes and taking out longer mortgage terms to make monthly payments more affordable, Barclays’ latest mortgage data shows.

Barclays reported that in August 33.5% of first-time buyers purchased a semi‑detached property, up 1.7 percentage points year‑on‑year, while the share buying flats fell to 19%, a decline of 2.7 points. Three‑bed properties were the most popular, accounting for 46% of all purchases in the month. The lender said these patterns point to a growing preference for a "forever home" — a first purchase intended to meet needs for many years rather than purely to get a foot on the ladder.

To finance larger purchases, a rising share of first‑time buyers are stretching mortgage terms. Barclays’ figures show 41.3% of first‑time buyers secured mortgages of 30 years or more in August. The data also found that 37% of mortgage holders viewed 30‑ to 40‑year terms as more desirable than shorter durations because they can reduce monthly repayments. Barclays’ head of mortgages, savings and insurance, Jatin Patel, said the patterns suggest buyers are thinking long term rather than simply seeking initial affordability.

Longer terms lower monthly costs but increase the total amount repaid over the life of the loan. The Barclays data showed household strain: 41% of homeowners said mortgage payments took up too much of their monthly income, and the average reported share of take‑home pay devoted to mortgages rose to 27.7% in August from 26.6% in July.

Buyers cited several reasons for opting for larger homes as their first purchase, Barclays said. Staying put can avoid the costs and disruption of moving — including stamp duty, legal fees, surveys, removals and renovation — and provide space for growing families. For example, the notes accompanying the data cited a stamp duty bill of roughly £5,000 on a £300,000 dwelling for a buyer who is not a first‑time purchaser. Demographic shifts also help explain the trend: Halifax data shows the average age of a first‑time buyer is now 33, and Barclays found millennial homeowners (aged roughly 28 to 43) were most likely to prioritise extra space, with 22% saying they bought a property with more bedrooms than they currently need, versus 13% across all age groups.

Almost three in 10 recent buyers said they intended to stay in their new home for at least 10 years, Barclays added.

Mortgage supply and underwriting have also evolved. Lenders have introduced products with lower deposit requirements — for example, Newcastle Building Society recently launched a mortgage requiring a 2% deposit, available only to borrowers not using parental help — and some major banks have widened lending at higher income multiples. Regulatory changes introduced by the government have allowed lenders greater flexibility to offer mortgages over 4.5 times borrowers’ annual incomes in a larger share of their books; some lenders are offering multiples as high as six times salary, Barclays said. Several lenders have also lowered the stress rates they use to test borrowers’ ability to afford payments if interest rates rise.

Industry observers and brokers have advised prospective borrowers to explore options early. Mortgage products can change quickly and fees can often be added to the loan or paid upfront, affecting the effective cost. Barclays and market commentators noted that buyers whose fixed‑rate deals are ending, those arranging a purchase and buy‑to‑let landlords should compare rates, consider seeking broker advice and be prepared to act when competitive offers appear.

The shift toward larger first homes and longer terms comes as the UK housing market continues to adjust to higher borrowing costs compared with several years ago and to changing policy and lender practices. For many first‑time buyers, stretching affordability through extended terms has become a mechanism to secure a home that can meet future needs while keeping near‑term monthly outlays manageable.