The most and least affordable towns in the united kingdom for first-time buyers

House prices vary significantly based on where you’re looking to purchase a house, but new information has underlined the difficulties facing first-time buyers in some areas.

New data from Halifax shows that average house prices range from 3.1 times to 11.9 times average local earnings, depending on where you live in the united kingdom.

Here, Which? explains what’s became of house prices and mortgage deposits for first-time buyers, and analyzes the most and least affordable towns to purchase your first home.

First-time buyer numbers fall by 13% in 2021

New research by Halifax implies that 304,657 first-time buyers got around the property ladder in 2021 – a drop of 46,000 compared to the previous year.

This was largely brought on by the outcome of the COVID-19 pandemic and property market shutdown last spring.

Despite low-deposit mortgages drying up, the amount of first-time buyers increased significantly throughout the other half of the season, and was just 2% down on 2021’s figures.

Northern Ireland (23%), Wales (23%) and Scotland (21%) saw the biggest overall falls in first-time buyer numbers in 2021, while London saw the smallest (6%).

Where in the united kingdom are first-time buyers making the ladder?

The chart below shows typically the most popular regions for first-time buyers purchasing a home in 2021.

London arrived on the scene on top, using more than 60,000 people buying their first property within the English capital, compared to approximately 8,000 in the whole of Northern Ireland.

The most affordable places to purchase a home

Halifax assessed the most cost effective places for locals to buy their first home, based on average annual earnings and average property prices in the region.

It found that Burnley in the North West of England was the most affordable town for first-time buyers, with house prices just 3.1 times the typical local income.

The remainder of the top 10 was dominated by Scotland, as shown within the table below.

The least affordable places to buy a home

At the other end on the table, it’s no surprise that Greater London is the least affordable spot to purchase your first home – with house prices in lots of areas as much as 11 times the average local salary.

Islington was found to become the most unaffordable place for first-time buyers, with prices at 11.9 times annual earnings.

The only places outside of London to help make the top 20 were Oxford (10.3 times annual earnings), Slough (Ten times), Hertsmere and Cambridge (both 9.9 times).

Prices rise by 10% and deposits soar

The average price paid with a first-time buyer rose to lb256,057 in 2021, a rise of lb22,939 (10%) on 2021’s figure. The largest rise in house prices arrived free airline Midlands (11%), as the smallest was in Scotland (1%).

Most concerningly for prospective first-time buyers, deposits increased substantially last year. Halifax says first-time buyers put down an average of lb57,278 in 2021 – an increase of lb10,829 (23%) year-on-year.

How much deposit must you buy a home?

The table below shows the typical deposit pay by first-time buyers in regions over the UK.

As you can observe, in all areas except the North West of England, buyers have a tendency to put down a deposit with a minimum of 20% of the cost.

The overall average deposit pay by a first-time buyer in 2021 was lb57,728 – though this figure is skewed by deposits in London.

Mortgage choices for first-time buyers

It’s no secret that many first-time buyers across the country rely on the financial institution of Mum and pa to help using their deposits, and this explains our prime figures above to some degree.

The accessibility to low-deposit mortgages is another key issue.

Right now, to purchase a property on the open market you’re prone to require a deposit of at least 10%, as 95% mortgages have completely dried up since the start of the pandemic.

Banks happen to be relaunching their 90% deals during the last couple of months, there are now much more options out there for first-time buyers, though you will have to pay reasonably limited compared to the rates on offer a year ago.

Buying a home with a small deposit

If you’re looking to buy a house having a deposit of under 10%, you may need to take a look at alternative choices to obtaining a standard mortgage.

The government’s Help to Buy scheme will be relaunched in April with regional price caps, though this really is restricted to new-build homes only.

Other schemes such as shared ownership can also be found, as are a variety of guarantor mortgages, which permit a parent or gaurdian or member of the family to help you on to the property ladder by using their home or savings as collateral.

How to buy your first home in 2021

If you’re looking to get on to the property ladder this year, we’re here to help with the advice you'll need.

As a place to begin, take a look at our step-by-step help guide to buying a house, which takes you on the journey from saving a first deposit to exchanging contracts.

If you're can not get to grips with mortgages, we have lots of advice on the different sorts of deal, how much you can borrow and the way to apply.

Finally, you can check out our mortgage lender reviews, which combine customer ratings with our expert analysis to recognize britain's best mortgage lenders.