First-time buyers have seen a 21% hike in property prices over the last decade, with the average price rocketing from £172,659 in 2008 to £208,741 now, according to the latest First-Time Buyer Review from Halifax.
The review revealed that the increase is more than double the 10% rise for all buyer types, and across Britain the average price of first-time buyer properties has out-performed the overall housing market.
The greatest increase was experienced in London, with first-time buyers expected to pay an average of £419,608, a 48% increase. This was followed by the South East, where the average price has risen to £275,632 and East Anglia was in third place with first-time buyers spending an average of £210,639.
However, in the North of England and Wales, house price growth for first-time buyers was relatively modest at 8% and 9% respectively. In Northern Ireland the average first-time buyer price is a third lower (down 33% to £124,035 and the lowest in the UK) than in 2008.
Furthermore, the review found that first-time buyers are now putting down record deposits for their first home. Across the UK, the average deposit is £33,127, a 71% increase from the £19,364 recorded in 2008. In London, the average firs-time buyer deposit is £114,952, or the equivalent of 27% of the purchase price, and a three times more than the average deposit of £38,335 ten years ago.
As a result of property values and deposits at elevated levels, first-time buyers have become reliant on family assistance, with the latest figures from the Office for National Statistics (ONS) revealing that 34$ of new buyers received financial help from parents.
Despite this, half of Brits aged between 18 and 34 think it is harder than ever to get on the housing ladder, and almost one in five believe that they will be renting forever. Older renters are less hopeful than younger ones at owning a home, with 26% of 31 to 34 year olds saying that they will never be able to purchase a home.
A third of young people said that the only way they will be able to get on to the property ladder is by inheriting the cash, while more than one in ten (16%) would consider emigrating because of the high property prices in the UK.
Halifax managing director Russell Galley commented: “First-time buyers are having to dig deeper than ever to get onto the property ladder. With the average price now over £200,000 and deposits at £33,000 it’s not surprising that the average age of a first-time buyer has crept up to 31.”
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