The cost of a first home now tops £405,000
The surge in house prices is painful for first-time buyers but Ruth Bloomfield offers comfort with her area-by-area house search guide
THE financial struggle endured by London’s first-time buyers is highlighted today in research revealing that the cost of an average first home in the capital has topped £400,000 — coming in at an unprecedented £405,106, exclusive Lloyds Bank data shows. It means the sum a first-time buyer requires to secure a foothold on the capital’s property ladder has shot up 71 per cent since 2012.
The average loan taken out by a firsttime buyer in London is £317,253 and they scrape together an average deposit of almost £90,000 — despite interest rates at a record low.
In 2012 the typical London first-time buyer needed to budget £939 a month to service their mortgage. Today they need to find £1,386, almost twice the UK average. “Because monthly mortgage payments and deposits have increased substantially, there was a five per cent drop in first-time purchases last year,” says Andrew Mason, mortgage director for Lloyds Bank.
The cost of a typical first home varies hugely across London, with the cheapest in Barking and Dagenham, at an average £292,446, while Croydon, Havering and Bexley all come in under £350,000. But good-value locations where firsttimers concentrate their search have seen the steepest price growth in the last five years. The cost of a first-time buy in Olympic boroughs Waltham Forest, Newham and Greenwich has soared by more than 90 per cent since the London Games in 2012.
The average first-time mortgage loan in Barking and Dagenham is £241,520, and in Havering, Enfield, Bexley and Croydon it’s under £280,000. But in both Westminster and Camden it’s £450,000-plus.
In Westminster the average first-time buyer mortgage repayment is £2,016 a month, while in Camden it’s £1,973. At the other end of the scale in Barking and Dagenham the figure’s £1,055, while in Havering, Enfield and Bexley it’s less than £1,200.
Deposits are the key barrier to home ownership in London, with the average put down by a first-timer soaring from £57,393 to £87,853 over five years. Nationwide, it’s £37,570. No London borough has an average under £50,000. The cheapest is Barking and Dagenham at £50,926.
HAVERING and Bexley are the only other boroughs with average deposits under £60,000. Towards central London the figures rocket, with the biggest, an eye-watering £190,518, paid in Hammersmith and Fulham. In Camden the average deposit is £150,331, and Islington firsttime buyers have to save £144,048.
local first-time buyers borrow under £280,000 on average
£399,995: a twobedroom house in Enfield. Call Baker & Chase (020 8012 4743)