Who pays the postage to resend parcel that Royal Mail returned to the sender?

[WeAreEternal]

Item sent our first class last week, Monday seller received the parcel back with 'return to sender, unable to deliver' stickers on it.

Seller checked and they printed the correct address out, and I confirmed it was right.

Seller has said they will resend but since the fault was not theirs they think it's unreasonable for them to have to pay for the postage again and asked for me to pay half as 'it's not really my fault either so 50/50 is fair'
They then said they will send it the cheapest, probably second class, but I paid for first class, I wanted first class.

What is usually done in this kind of situation?

I think 50/50 is a good idea but request 1st class postage.

I think the seller is obliged to either pay to send again or to refund you in full.
I'd personally be wary as I've never had an 'undelivered' returned back to me so quickly..

I would ask for full refund & shop elsewhere - too early for item to be returned isn't it?