The average mortgage taken out by a first-time buyer in London has increased by a staggering 71% since 2012, new research has found.
According to Lloyds Bank, mortgages in the capital have risen from £185,538 to £317,253 over the last five years – nearly double the UK average.
Average first-time buyer house prices in London boroughs have risen most rapidly in Waltham Forest over the past five years, going up by a whopping 93% from £212,629 to £409,491.
The boroughs recording the next biggest gains are Newham (92% to £359,212) and Greenwich (91% increase to £382,945). All three adjoining boroughs had average prices well below the London average five years ago.
Westminster has seen the smallest rise in prices since 2012, with an increase of 28% to £595,568. This is less than half the gain across London as a whole (67%) and significantly below the UK average of 50%. Westminster was the most expensive borough for first-time buyers in 2012 with an average price of £466,482 – 92% above the London average of £242,931.
Hammersmith & Fulham (36%), Richmond-upon-Thames (47%), Camden (47%) and Islington (49%) were the only other boroughs to experience an average first-time buyer house price rise of less than 50% between 2012 and 2017.
Despite its relatively small price gain over the past five years, Camden has become the most expensive borough for first-time buyers, with an average house price of £602,080.
At the other end of the scale, Barking & Dagenham has remained the least expensive borough for first-time buyers despite a 74% rise in average prices since 2012. The borough is the only one where the average price paid by first-time buyers is below £300,000 (at £292,446). Havering (£317,168) and Bexley (£324,910) are the next least expensive boroughs for first-time buyers.
The average deposit in the capital has risen by over £30,000 over five years from £57,393 in 2012 to £87,853 in 2017, compared to the UK average of £37,570.
Meanwhile, the average age for a first-time buyer in London is 32 compared to the UK average of 31.
Andrew Mason, Lloyds Bank mortgage director, said: “Over the past five years, the price of a first-time buyer purchase in London has risen by an average 67%, with some parts of the capital recording even more substantial rises.
“This means monthly mortgage payments and deposits have increased substantially, making it increasingly difficult for many young people to buy their own home, and as a result we saw a 5% drop in first time purchases last year.”
