If you're dreaming of owning your first home in south-east England - you may have to put that dream on hold for a sec. Did we say sec? Sorry - meant to say for seven years.
First-time buyers in some parts of south-east England will have to wait seven years to step on the housing ladder than buyers in the rest of the country, according to UK’s largest mortgage lender Halifax.
Across UK, the average first-time buying age is 30, but this hides a big gap between ages people buy in different parts of the country according to Halifax. Compared to 27 in parts of south Wales, the average age to buy in London can be as high as 34 in some boroughs.
The figures are based on earnings and mortgages approved by Halifax. The 10 areas with the youngest first-time buyers all have properties under the national average of £200,754. In Carlisle, for example, the typical first-time buyer property costs £122,826 - which is four and a half times local earnings. Sitting in stark contrast, Ealing in west London’s average house costs £410,763. That’s 10 and a half times average earnings - and where first-time buyers are 34 years old on average.
Since the financial crisis of 2007, lenders stopped offering 95% loan to value (LTV) mortgages, making it miles harder for first-time buyers to enter the property market.
But the culture of the property ladder seems a unique obsession in Britain. Though homeownership is the ultimate goal of British families, the same isn’t so on the continent. In Germany, rents are lower and people aren’t as hell-bent on buying. Supply of good-quality rental accommodation, and a tax regime that isn’t exactly great for homeowners, mean Germans don’t feel forced to grapple for property like us Brits. Plus, it’s been years since they’ve experienced a house price bubble. In Britain, the average house price has risen by 8.2% in the past year, so you can see why we’re anxiously clawing at the property ladder’s rungs compared to our continental counterparts.
The adage that our down payment savings are landing straight into our landlords’ back pockets is, unfortunately, a depressing reality. But hey, we could always join the 43% of 18-34 year olds who have moved back in with their parents? It’s always good to have options.
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This article originally appeared on The Debrief.