First-time buyers face a tough climb up the property ladder as homes get smaller and pricier, while deposits demand a king’s ransom!
Thinking of buying your first home? Get ready for a bumpy ride! A new study by Yorkshire Building Society has revealed that first-time buyer properties have shrunk considerably over the past few decades, while the deposits needed have grown fatter than ever.
The Tiny Flat vs. the Spacious Semi
Back in the groovy 1970s, the typical first-time buyer could snag a charming two-bedroom semi-detached house, often with a garden, for a song. Today? Forget about it! The average first-time buyer is now looking at a cramped two-bedroom flat, usually with two bathrooms, for a massive £215,699. That’s a six-fold increase from the average price tag of £19,309 (about £92,172 in today’s money) back in the 70s. And gardens? A distant dream for many!
Deposits Demanding a Small Fortune
The pain doesn’t stop there. In the 1970s, first-time buyers needed to borrow around £11,149 (about £52,220 today) for their mortgage. Fast forward to today, and that figure has ballooned to a dizzying £200,000. And the deposit? Brace yourselves! Today’s average 10% deposit sits at a daunting £20,000 – that’s more than half the typical annual salary!
Older and Still Struggling
To add insult to injury, the average age of first-time buyers has shot up from a sprightly 24 in the 1970s to a weary 30 in 2021.
The Shrinking Dream of Outdoor Space
Remember those lovely gardens that graced 85% of first homes in the 1970s? Well, wave goodbye to those! Today, only 66% of first homes offer the luxury of outdoor space.
Is Homeownership a Pipe Dream?
Ben Merritt, a mortgage expert at Yorkshire Building Society, paints a stark picture: “Achieving homeownership isn’t easy…house price growth means people are having to borrow much more…and for some it’s now, sadly, completely out of reach.”
He acknowledges the immense pressure on today’s generation of first-time buyers, saying, “The need to compromise on quality-of-life aspects like having a garden or a drive has arisen over the decades…it just goes to further highlight the scale of the challenges…despite being willing to compromise.”
So, what’s a budding homeowner to do? While the road to homeownership might seem paved with obstacles, it’s not entirely impossible. With careful planning, a bit of luck, and perhaps a helping hand from innovative mortgage solutions, that dream of owning your own slice of the property pie might still be within reach.