Fewer first-time buyers can afford home in Cardiff
NEW research by Post Office Money reveals that in 2015 only 48% of first-time buyers could afford to purchase a property in Cardiff compared to 90% 20 years ago.
And this isn’t the only shocking Welsh statistic the Priced Out survey has published.
In the year 1995 the average Welsh house price was £52,978. Although first-time buyers earned less, on average £16,022, they only needed 3.31 times their income to secure a mortgage for their first home.
Fast forward to 2015 and the average Welsh house price is now £173,996, with first-time buyers needing 4.72 times an average or combined salary of £36,863 to move into their first property.
Over the 20-year period analysed by the survey Welsh house prices have increased by a whopping 228% but average income has only increased by 130%.
Consequently the percentage of mortgages awarded to firsttime buyers in Wales has fallen from a 53% success rate in 1995 to 42% last year.
But resilient first-time buyers are not willing to give up on their dream of buying a home.
The research reveals 42% of this group of potential property owners have compromised on their first home wish-list in order to secure a purchase.
The most significant compromise by these first home owners was to move further away from work with 15% of respondents commuting further than desired.
Buying a less than perfect home was a choice that 12% had to make.
A further 8% have been a little braver and taken on a property that needs structural work in order to get the keys to their first home.
Size is not necessarily important to some first time buyers as 8% have compromised on space and a further 8% have moved further away from friends and family than they would ideally like.
Interestingly proximity to shopping is more important to this group of Welsh house hunters than work, as the maximum journey time from the shops that is considered acceptable is 23 minutes compared to 38 minutes for work.
If first-time buyers in Wales could achieve their ultimate first property wish-list the most desirable feature would be having a garden, mentioned by 37% of respondents.
Proximity to shops and conveniences was mentioned by 33% of those questioned, 31% would like to be closer to work, and 28% wished for a larger property and to be closer to friends and family.
John Willcock, head of mortgages at Post Office Money, said: “These figures highlight the challenges facing today’s first-time buyers.
“Many would-be buyers are having to compromise on their housing needs in order to take that all-important first step onto the ladder.
“For some this is a case of prioritising what is really essential in a home, but for others this means significant changes to their lifestyle, moving further away from work, family and friends.
“The earlier people start to plan and save for the future the closer their housing reality is likely to be to their goal.”