Why Yorkshire's mortgage market is outperforming the rest of the UK

Affordability, rising wages and a surge in first-time buyer demand are keeping Yorkshire's mortgage market ahead of the national trend, according to brokers operating across the region.

Figures cited by the Yorkshire Post, drawing on research from property portal Zoopla, show first-time buyer demand across Yorkshire and the Humber growing at 4.8% year-on-year, compared with 3.4% for the broader Yorkshire market. House prices in Leeds and Sheffield are rising at 2.6% and 2.3% respectively, against a UK average of 1.5%.

Meanwhile, Rightmove data shows asking prices across the North East up 2.7% annually and the North West up 2.6%, with London and the South East recording annual declines of 2.4% and 1.6% respectively – a divergence that underlines a growing north-south divide in UK housing.

Katherine Stagg, managing director of Stagg Mortgage Services in Sheffield, told Mortgage Introducer demand has picked up noticeably in recent weeks after a quiet May. "The market is definitely more susceptible and it's rising. We had a very quiet sort of May and then in June it has definitely picked up."

Stagg believes affordability relative to London, combined with access to open countryside, was drawing buyers to the region. "The house prices are better. Obviously, the London market is ridiculously expensive but also you've got the countryside as well on your doorstep – you've got the Peaks, you've got Bakewell and everything else."

Minimum wage rises boost Yorkshire first-time buyer activity

Hull-based Malcolm Davidson, who is managing director of UK Moneyman, told Mortgage Introducer increases in the national minimum wage are a factor making homeownership more accessible in northern regions. "The property prices are so expensive in the south east of England that it doesn't really have an impact, but it does in the north where property prices are cheaper.

“You still need two earners, but a minimum wage job will get you onto the property ladder. And therefore, I think that's why our region is holding up better than most."

Davidson pointed to rising rents and motivated sellers offering flexibility on price as further reasons for buyers to act. "Mortgage rates are round about at normalised historical levels. Rents are going up, so there's an incentive to buy if you're a tenant. And there are some bargains to be had because there are some motivated sellers out there who are prepared to consider lower offers."

Buy-to-let investors shift Yorkshire property market dynamics

Both professionals noted a shift in the buy-to-let market, with smaller landlords retreating and more professional investors moving in. Davidson described the situation as "the slow demise of the amateur landlord, the accidental landlord and the dinner party landlord in favour of the more professional landlord who's doing this as a full-time job," adding that Yorkshire's higher yields were attracting portfolio landlords from other parts of the country.

Research from Hamptons shows tenants moving into newly-let homes in Yorkshire and the Humber paid an average of £944 per month in April, up 1.9% on the previous year.

The national picture remains subdued. The Office for National Statistics (ONS) reported UK house prices were flat in March, with the average home valued at £268,000. Nationwide Building Society data showed average UK house prices fell by 0.6% in May, while annual growth slowed from 3% in April to 1.7%.

The Royal Institution of Chartered Surveyors (RICS) reported a net balance of 34% of professionals seeing prices fall in April, up from 25% in March, with new buyer enquiries and agreed sales also remaining muted.

What would a BoE rate cut mean for buyers?

Stagg said a Bank of England (BoE) base rate reduction remained the most significant lever available to unlock broader market activity, with uncertainty around rates causing some buyers to delay decisions. UK mortgage professionals have been calling for the BoE to cut the base rate to drive down lending costs and open the market to a wider pool of buyers.

Despite the national uncertainty, those looking to get on the ladder remain active in the market. Stagg's message to first-time buyers, who currently make up 70 per cent of her company’s clients, is straightforward.

"The longer they leave it, the harder it's going to get, because the more it's going to go up in the monthly payments," she said. "They've just got to try and get on the ladder."

Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.