House Prices for First-Time Buyers in London Rise by 250%
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New research has showed that house prices for first time London buyers have soared by over 250 per cent in the last ten years. Today the average cost of first time buyer properties is nearly £260,000.
Home buyers getting on the property ladder paid an average of £159,494 for a property in 2007, a staggering 300% jump compared with about £52,674 in 1997.
Nevertheless the average income of a UK family only increased by 53 per cent over the past ten years.
The result is a generation of young people are being locked out of the housing market.
Adam Sampson, chief executive for the housing charity Shelter said:
These new figures show in full the true and worsening situation first-time buyers find themselves in.
Every year the gulf between what first-time buyers can afford and the cost of housing is widening.
Despite falling house prices, many lenders are increasing their mortgage rates, making an already desperate situation worse.
Shelter’s research found that the average first-time buyer home cost 3.4 times average earnings at the end of last year, double the ratio of 1.72 in 1997.
The average monthly mortgage repayment has also soared by 172% from £304.80 to £827.87, taking up 21% of the average working household’s income, compared with just 12% a decade earlier.
Not only are first-time buyers facing higher property and mortgage costs but lenders are also demanding increasingly large deposits.
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