Of course, the figures vary greatly across the country and the average is driven up by the astronomical price of property in London. Still, the message is clear – it’s not getting any easier to get onto the property ladder.
And why not? Basically, because house prices are going up faster than wages and have been doing so for years.
The IFS says that in 1996 over 90 per cent of 25- to 34-year-olds would have been able to purchase a house in their area as long as they had a 10 per cent deposit and if they borrowed 4½ times their salary (the maximum that most lenders will now allow). By 2016, that proportion had fallen substantially. Even with a 10 per cent deposit, only around 60 per cent of young adults would have been able to borrow enough to buy even one of the cheapest homes in their area.
The IFS has put forward some ideas for tackling the problem. In a nutshell, it is about building more homes where they are needed.
At Larkfleet Homes we are caught on this ‘house price escalator’ along with everyone else. By far the biggest cost of building a house is usually buying the land to put it on and we have to compete with other builders to buy sites for development.
But we are trying to do what we can to help. There is advice on our website for first-time buyers (and that helped us win a nomination for the First Time Buyer Magazine Reader Awards for best website earlier this year). And we are pleased to introduce potential buyers to independent financial experts who can advise on the best mortgage deals.
We can also assist people get support from the government’s Help to Buy scheme. And it is worth pointing out that this is not just for first-time buyers – even those moving house can qualify.
So come and talk to us.
