A new study suggests that first-time buyers in the UK need to be earning an average of £53,000 in order to buy a home in one of Britain’s largest cities.
This is up from just £45,000 back in 2015, suggesting that the minimum income required by first-time buyers has increased by as much as 18 per cent over the course of just three years.
The research, which was carried out by Hometrack, analysed house prices and home-buying costs all across the country and found a number of significant regional differences.
It found that buyers in London need an income of £82,000 in order to take their first step on the property ladder, while home-hunters in Liverpool only need to be earning £25,000.
However, even in the cities deemed most affordable, house price growth is skyrocketing – pushing properties increasingly out of the reach of younger buyers and those with small deposits, the study found.
Richard Donnell, Insight Director at Hometrack, said: “House price growth continues to outpace earnings across 16 of the 20 cities covered by the index as buyers continue to bid up the cost of housing on the back of low mortgage rates and high levels of employment.
“The fastest growth is being recorded in the most affordable cities where prices are rising off a low base,” he added.
However, Steve Seal, of lender Bluestone Mortgages, said that first-time buyers should “remain optimistic” at a time when many lenders appear to be cutting rates and offering “competitive deals.”
Meanwhile, statistics from elsewhere suggest that mortgage approvals continue to rise, as first-time buyers and those with small deposits continue to take advantage of Government-backed incentives such as Help to Buy.
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