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Revealed: The least affordable area for first-time buyers

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Written by: Christina Hoghton
03/07/2017
It won’t come as much of a surprise to learn that the 10 least affordable Local Authority Districts (LADs) for first-time buyers are all in London, according to Halifax.

The least affordable LAD of all is… Brent, where the average first-time buyer property price of £459,499 is an eye-watering 12.5 times average annual earnings in the area.

At the other end of the scale, Stirling in Scotland is the most affordable area in the UK, with an average property price of £136,181 – just 2.9 times local earnings.

Record prices

In the first half of 2017, the average house price paid by first-time buyers across the UK was £207,693 – the highest on record.

In the past five years, this average price has grown by 50% from £138,663 (an increase of £69,025), outperforming price growth across the entire housing market.

In London, first-time buyers have seen the average price skyrocket by 66% (or £163,664) since 2012 to £409,975 – the highest on record.

Not only is the average price in London for first-time buyers now three and a half times higher than in Northern Ireland (£115,269) – it is also 48% higher than the second most expensive region, the South East (£276,773).

The average deposit paid by first-timers was £32,899 in the first six months of 2017 – 16% of the purchase price.

Boost in buyers

A decade ago, just over a third (36%) of all house purchases financed by a mortgage were made by first-time buyers. In 2017, this proportion is estimated to have risen to almost half (47%). While the homemover (current owner occupier) market has slowed, housing activity has been dependent on those taking the first step on the ladder.

Martin Ellis, housing economist at Halifax, said: “For the third time in four years the numbers getting on the housing ladder have exceeded 150,000 – a level of momentum not seen since before the financial crisis.

“High levels of employment, low mortgage rates and government schemes such as Help to Buy have also helped these numbers remain robust, as first-time buyers continue to form a fundamental part of the UK housing market.”

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