First time buyer
misery
Want to get a foot on the property ladder? It’s getting even harder,
according to a new survey
Along with the continued rise in property prices, there’s more bad news
for people looking to buy their first home. According to Halifax’s first
Annual First Time Buyer Review, 80 per cent of UK towns were unaffordable
for the majority of first-time buyers last year.
The Halifax’s report also reveals that first-time buyers paid 17 per
cent more in 2003 than they did the previous year. Consequently, the number
of first-time buyers dropped last year by 32 per cent compared to 2002.
More significantly, for the first time ever the average first-time buyer
in every UK region had to pay stamp duty as property costs continued to rise.
The threshold for paying stamp duty is currently £60,000.
Property notspots
Perhaps unsurprisingly, given that it led the Property Hotspots table for
much of 2003, affordability for first-time buyers was lowest in East Anglia.
Incredibly, the Halifax says that no towns in that region are affordable
for first-time buyers. The South West was second, with 98 per cent of towns
declared unaffordable.
The West Midlands, the South East and Greater London also scored highly for
unaffordability. At the other end of the scale, only 44 per cent of towns
in Northern Ireland and 54 per cent in Scotland were declared unaffordable.
Here are the UK's regions ranked for affordability for first-time buyers:
Region Number of towns % of housing unaffordable for first-time buyers Region
Number of towns % of housing unaffordable for first-time buyers
East Anglia 23 100% East Midlands 38 83%
South West 48 98% Yorkshire & the Humber 45 75%
West Midlands 43 90% Wales 25 71%
Greater London 49 86% North West 40 62%
South East 146 86% Scotland 28 54%
North 38 84% Northern Ireland 8 44%
In 2003, the UK average house price to earnings ratio for first-time buyers
was 4.27 compared to 3.64 in 2002. The highest regional house price to earnings
ratios in 2003 were in Greater London, the South East and the South West.
The average deposit made by a first-time buyer in the UK is now £20,000
or 18% of the property's value compared to 19% (£18,262) in 2002.
So it seems that unless the housing market falls dramatically, first-time
buyers will continue to struggle to get onto the property ladder.
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