First-time buyers paying up to 60% more to get on housing ladder than five years ago

First-time buyers are paying up to 60% more for their home than five years ago, new figures reveal.

Prices for people buying their first house have gone up 40.6% in England, but in one city, Bristol, the prices are 58.9% higher than in 2013.

In London, prices for first-time buyers jumped 52.5%.

Other cities like Manchester (53.7%), Coventry (49.3) and Nottingham (48.6%) have also seen big increases, latest analysis of the Land Registry house prices index shows.

The most modest regional increase was in the north-east at just 13.1%, while in Scotland, first-time buyer house prices in Aberdeen have dropped 5.4%.

The research was carried out by property management firm Apropos by DJ Alexander, whose joint managing director David Alexander said: “These figures highlight the enormous differences in average first-time buyer prices across the UK, with some places such as Bristol, Manchester and London all increasing between 50%-60% in a five-year period.

“What this tells us is that demand remains strong among first-time buyers even in the face of large increases in average prices.

“The spread of price increases across the country would indicate that confidence in property ownership remains high and many first-time buyers are committed to home ownership.”

Salaries required by first-time buyers needed to secure a mortgage have risen 18% in the last three years, according to Hometrack.

NAEA Propertymark chief executive Mark Hayward said: “Our research shows first-time buyers account for over 25% of the market, which is encouraging as it promotes activity upwards in the chain.

“Caveat this with the huge success of Help to Buy which whilst encouraging in terms of new-builds does not feed into the general market place but into a ‘cul-de-sac’ with no assistance to upward activity.”

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One Comment

  1. Peter Hendry

    House prices for first time buyers have gone up by 60% on average over the past five years you report here.
    Salaries for the same group of people have gone up on average by 18% in the same period.

    Is it ok that this is happening and can’t everyone see that by condoning it, many fewer sales are likely to take place.
    This must directly affect the amount of business available for those working in the property sector!
    Against this backdrop one must surely see that there is only a finite-sized ‘cake’ from which slices of equity may be cut at any one time.

    The remedy and solution to this, which is being earnestly proposed to the agency profession is to change the way the market is operated, making it far more efficient than it is currently.  Unless the housing marketplace works efficiently, prices will drift beyond those which would exist in a perfect market by reason of defined economic theory.
     
    The Hendry Solution is the only current proposal for resolving this problem for the benefit both of estate agents and also for first-time buyers.
     

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