By Siham Ben Amor, MD – WER Investments Ltd
For many years, “first-time buyer” and “Central London” rarely appeared in the same sentence unless the punchline was “impossible.” But 2024 quietly rewrote the script: first-time buyer activity in London jumped 19% compared to 2023. Yes, you read that right, people are still finding a way in.
So, is the door finally opening, or is this just a brief crack before it shuts again? Let’s take a look.
The Market in 2025: A Softer Headwind
The property market has been shifting in first-time buyers’ favor:
- Interest rates are easing – With the Bank of England’s base rate now at 4%, two- and five-year fixed mortgages have dipped below 5% for the first time since 2022.
- Prices have stabilized – Across London, growth has been modest, with some boroughs holding flat. This means flexible buyers have a better shot at negotiating.
- Confidence is returning – More lenders are offering higher loan-to-value (LTV) mortgages again, and competition is improving.
The Deposit Dilemma
Here’s the reality check: deposits in London are still eye-watering.
- UK average FTB deposit (2024): ~£61,000
- London average FTB deposit (2024): ~£125,000
For many, family support or years of disciplined saving is still essential. But government and lender-backed schemes are helping to bridge the gap.
Policy Tailwinds Worth Noting
Two major boosts for 2025:
- Permanent 95% Mortgage Guarantee – Now here to stay, meaning more 5%-deposit mortgages.
- First Homes Scheme – Discounts of 30–50% for eligible buyers, with London price caps up to £420,000 after the discount.
Add in Shared Ownership and Lifetime ISAs, and suddenly there are more levers to pull than a decade ago.
Where the Opportunities Hide
If you’re serious about getting in, here’s where to look:
- Older stock with character – Mansion-block flats or ex-local authority homes often price well below new builds.
- Regeneration areas – Zones 2 and 3 with new transport links or major redevelopments can offer today’s price at tomorrow’s location premium.
- Developer incentives – Furniture packs, legal fee contributions, or mortgage rate buy-downs are increasingly common.
Interestingly, these same areas attracting first-time buyers are also catching the eye of investors seeking buy to let investment London opportunities. Regeneration hotspots, in particular, are proving to deliver high yield property investment London potential as rental demand surges among young professionals. For those thinking longer term, some of these emerging neighborhoods may also represent the best property investments London has to offer, blending affordability, connectivity, and future growth.
What to Watch Out For
- High service charges in amenity-heavy new builds
- Resale restrictions on discounted schemes
- Ultra-prime postcodes still far beyond first-time budgets
My Practical Playbook for First-Time Buyers in 2025
- Get mortgage-ready early – Secure your Decision in Principle before house hunting.
- Think price per square foot – Don’t just chase a headline price; value is in the details.
- Explore multiple schemes at once – Maximise your chances of finding the right fit.
- Negotiate on extras – Incentives can be worth thousands.
- Prioritise location over finishes – You can upgrade a kitchen, but you can’t move a flat closer to the Tube.
The Verdict
Yes, first-time buyers can still get on the ladder in Central London. But it takes creativity, compromise, and confidence. With rates softening, support schemes in place, and more realistic seller expectations, 2025 could be one of the most promising years in recent memory for those willing to act decisively.
💬 Your turn: If you were buying your first London home today, what would you compromise on first, location, size, or finish?
