First time House Buyers Finding it Impossible to Buy
In the competitive UK housing market there are often people who find the housing ladder far easier than others. First time buyers in the UK continue to be one of the hardest hit demographics and this has been proven as home sales continue to decline for buyers who are unable to get on the housing ladder.
Although there has been an increase in housing supply in recent months, the number of house hunters is also at its highest point in more than 11 years. Unfortunately, the number of first time house hunters fell to just 23% in July.
With the cost of housing rising, first-time buyers will steadily be pushed out of the market. First-time house buyers need to earn an average of £50,000 annually to purchase a property. However, research from GoCompare found that the average salary in 51 out of 65 UK cities was well below that price.
Owning a home is seemingly feasible in lower value areas such as Blackburn where a £14,000 yearly salary could be enough to purchase a flat and it’s a similar story in other cities like Hull and Blackpool where you could buy a basic flat on a low income.
However, in many of the metropolitan cities such as Brighton and London, the gap between housing prices and salary make it nearly impossible to afford a flat for a first-time homebuyer, unless they’re making a minimum of £55,000 on average. Unsurprisingly, London is the most unaffordable city and with a average income of around £30,000 there is clearly a big problem. London isn’t the only city that experiences these vast disparities between wages and housing prices other areas such as Brighton also has a unrealistic wage to house value ratio. With the average UK house price continuing to set new highs and wages remaining the same this income gap is only getting larger
Some estate agents are optimistic that in the next few months we will see more activity in the market from first-time house buyers as more properties hit the market. Although the increase in available housing has increased, the simultaneous increase of would-be buyers has also hit a record high.
The fact is, there simply isn’t enough supply to meet the growing demand for properties around the U.K. Unless you can receive help from the bank of mum and dad then until genuine action is taken to build more properties, the housing crisis cannot be fixed.