First-time buyers in London are paying double the amount for a home in capital than those across the rest of Britain.
Data from Lloyds Bank revealed people stepping onto the property ladder in London fork out an average of £420,132 for their first home while those in the rest of the UK pay £210,515.
Indeed, price rises in London over the past five years mean the average cost of a first-time buyer home in the capital has soared by close to two thirds, with properties in the outer boroughs increasing by 47% for all buyers.
And the average deposit now put down by first-time buyers in London is £92,833, which is 62% higher than in 2013.
As a result of these huge rises, the number of buyers getting onto the housing ladder in the capital fell by 5% in 2017. Five years ago 17% of the first-time buyer market was in London, but now the capital only has 12% of this group of property purchasers.
Andrew Mason, Lloyds Bank mortgage products director, said: “Despite the recent slowdown in London house prices this latest data shows how expensive it has become to live in the capital, particularly for young people trying to get on the housing ladder for the first time.
“As a result, first-time buyers have to wait until they are 34 before getting their first foot on the property ladder.”
“While property prices drop as you head to the fringes of the capital, our analysis is showing that this gap is closing as house price growth in Outer London boroughs is continuing to increase at a greater pace than Inner London boroughs.
“This healthy growth may be linked to a high demand for these more affordable properties as well as some areas benefitting from the new Crossrail link due to open next year as commuters move further afield.”
Lloyds’ data was published as the Office for National Statistics (ONS) latest house price data reported London remained the region with the highest average house price – at £472,000 in March.
Yet it was also the area with the lowest annual growth, with prices decreasing by 0.7% over the year to March. This is the lowest annual growth in London since September 2009.
Across the UK as a whole house prices were £9,000 higher than in March 2017 and £500 lower than last month. It means the average price of a house in the UK was £224,000, according to the ONS’s figures.
Daniel Hegarty, CEO and founder of digital mortgage broker Habito, said: “While the level of house price growth has slowed since 2016, getting on the property ladder has become an impossible dream for many young people.”
He added: “All prospective first-time buyers should be aware of the schemes that are on offer to make owning a home more accessible including Help to Buy and Shared Ownership, which have already and should continue to benefit many who will not need as high a deposit as would otherwise be expected.”
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