Getting on the Property Ladder in 2019
It is said that the property ladder is near impossible for anyone to get on these days. While today’s first-time homeowners find it harder than their parents or grandparents, it is not strictly true that it is “impossible”. Some parts of the country have runaway house prices with wages rising far slower. Yet there are also areas of the country which are much easier for first time owners to buy. The issue is a matter of concern that successive governments have tried to address.
What First-Time Buyers are Up Against
It was recently revealed that first-time property owners must save for 10 years to get on the property ladder. The biggest challenge is to save enough money for a substantial (usually anything between 5%-20%) deposit. In some areas of the country, reasonable flats start at around £200,000. That means a £20,000 deposit on average, which is perceived as virtually impossible by many young people. For those with the income, as already stated, the time to save that much is around 10 years on average. Yet evidence suggests that nationally, the average deposit is around £32,000.
Then there is the cost of the mortgage and the repayment period over which to spread it. Working out how much the buyer or buyers can reasonably afford can be stressful. Once there is enough money for the deposit, there is also the need to consider the type of mortgage they can afford. Solicitor’s fees, survey costs, removals, insurance, and valuation fees are all added on top. Stamp duty for first time buyers does not come into force until the property value exceeds £300,000 but it is expensive for first time buyers.
Where are the Best Areas to Buy and Why?
The most desirable locations naturally have the highest demand and come with the highest prices. However, by looking slightly further afield within their desired catchment areas, first time buyers can successfully gain a foothold on the property ladder. Here, we present five of the best places for first time buyers. Homeowners never choose based on price alone, but also on amenities, location, desirability, crime, parking and transport connections. Value for money is more important than simply the cost of buying a first home.
Earlier this year, Hull topped a poll of most affordable places to buy a home. Overall, it is cheaper to buy a home anywhere in the north than any place in the south with a couple of exceptions such as big cities like Manchester. Hull, voted UK City of Culture in 2017, is experiencing a great time right now. Here, first time homeowners require less than £16,000 average deposit. Clearly, the city is on the way up.
The northeast has experienced a lot of regeneration, most of it in the last ten or twenty years. That’s why cities once ignored are hotspots for young professionals with businesses relocating for cheaper commercial property. The city of Newcastle might be the jewel of the north, but Middlesbrough was recently voted a great destination to buy a first home in terms of value for money. The average deposit to buy a home in Middlesbrough is currently just over £16,000.
Always a fantastic place to be in the northwest, Liverpool has history and culture in abundance, not least of all being home to The Beatles. Music is not the limit of its heritage though. It’s a great place for the creative arts, industrial heritage, and much more. Liverpool is an ideal place to set up a first home with a friendly environment and lots to do. On average, first time homeowners require a deposit of just over £18,000.
Heading into the midlands now, and Nottingham is another great place to start your journey on the property ladder. A surprising entry onto the list considering as recently as five years ago it was voted one of the least desirable places to live. It’s a city with plenty of culture, lots to do, some stunning architecture, and close proximity to major transport hubs, including airports. Residents require an average of just over £20,000 to get on the property ladder.
Another up and coming midlands location, Coventry residents require an average of £25,000 for a typical house in the city. Anyone looking to move there should consider doing so soon. It is the UK City of Culture for 2021. Over the last couple of years, there has been plenty of upgrades and investments to make Coventry worthy of the name. Employment is expected to grow over the coming years with investment in green technology.