Figures out today, which illustrate the affordability challenges faced by younger generations, revealed if house prices continue rising in the same way, a baby born today would need to put away £1,734 a year to get their first foot on the ladder.
Estate agent, Springbok Properties, based its calculations on average figures – namely, that first-time buyers are typically aged 30, the average price of a first home is £154,238 and the typical deposit is 10%.
Rising house prices
The research showed just how much things have changed in just seven years, revealing that back in 2012 a typical first-time buyer would have required only £12,000 for a 10% deposit on the averagely-priced first home for the time.
They would have needed to start saving £400 a year from birth to achieve this figure by the time they were 30.
It means, compared to 2012, today’s first-time buyers will need to have saved 28% more, an average annual increase of 4%. And, by these calculations, a baby born today will need to find £52,000 to put a 10% deposit down on their first home when they are 30.
‘Monumental issues’
Shepherd Ncube, founder and CEO of Springbok Properties, said: “£500 a year to get on to today’s property ladder might not sound a lot today, but when you consider this is not only over a 30-year period but is still just a 10% deposit and not a full property’s value, it really does drive home the monumental issues of affordability across the UK market.”
Researchers said this data was representative of the UK as a whole, but by focusing in on the regions they identified areas where the problem was more acute.
Indeed, in London a baby born today would need to save £16,508 over the next 30 years to secure their 10% deposit. In Cambridge and Bristol they would need to put away over £9,000 annually.
Ncube added: “I certainly hope for my kids’ sake, that these predictions don’t ring true and we don’t see the cost of buying spiral to these levels, however, if you would have told someone in 1988 they had to save £500 a year to get on the ladder in 30 years’ time, they probably would have laughed at you.
“So who knows what the future might hold?”
