Your location: First-time buyers 'locked out'
18 April 2008
House prices for first-time buyers throughout the UK have risen a staggering 200 per cent in a decade, the annual ROOF Affordability Index revealed.
Out in the current May/June edition of ROOF magazine, the index is seen as the most comprehensive yearly data on house affordability. It compares mortgage costs against working household incomes, and highlights the gap between what people can afford and the growing cost of housing.
The findings of the ROOF Affordability Index:
- The index shows the average first-time property price has rocketed nationally from £52,674 to £159,494.
- The figure is even higher in London where first-time buyers face a rise of 250 per cent to almost £260,000.
- While the average weekly income of working households has risen 53 per cent over the past 10 years from £590 to £900; average monthly mortgage payments have increased dramatically from £304.80 to £827.87 - a rise of 172 per cent.
- Mortgage repayment costs now take up more than 21 per cent of the average working household income, compared to less than 12 per cent in 1997.
- As a national average, it is now 78 per cent harder for first-time buyers to secure a home than 10 years ago, with househunters in every English region being hammered by spiralling housing costs, particularly in the West Midlands and South East.
Shelter chief executive Adam Sampson said: 'These new figures show in full the true and worsening situation first-time buyers find themselves in. Every year the gulf between what first-time buyers can afford and the cost of housing is widening.
'Despite falling house prices, many lenders are increasing their mortgage rates, making an already desperate situation worse. It means there is a generation of young people and young families being locked out of the housing market without a hope of ever sharing in the asset wealth of the generation before.'
