24th March 2016
Almost half of first-time buyers in London claim that sky-high house prices are preventing them from buying a property, according to research from Yorkshire Building Society.
Some 43% said they would be willing to move to a more affordable part of the UK if it meant they were able to own their first property.
A quarter, at 26% of London residents said they would even consider moving to another country to buy their own home.
Meanwhile, one in five aspiring first-time buyers in the capital claim they have moved to lower quality or shared accommodation in order to save money for their deposit.
Andy Caton, executive director at Yorkshire Building Society, said: “The London housing market continues to be very challenging for young people looking to get on to the property ladder, due to prices which are amongst the highest of any city in the world.
“Even taking into account the typically higher salaries earned in this part of the UK, many young people are finding themselves priced out of the city.
“It means that many Londoners at the start of their working lives are finding they have little hope of putting down roots in the capital.
“Although the willingness to relocate demonstrates the importance with which young people regard homeownership – as well as the lengths they are willing to go to achieve it – there are clearly acute problems facing first time buyers in London.”
London’s property market recovered strongly from the financial downturn of 2008 and in recent year’s property prices have risen sharply.
House prices in the capital are more than 46% above their pre-crisis peak, at an average of £525,000, according to the Office for National Statistics.
Private rents have also risen so sharply that the cost is now double the national average, at £1,400 a month, meaning that many Londoners are effectively priced out of living independently in the capital and have to resort to co-habiting with partners, friends or family.
In the Yorkshire Building Society survey, conducted by NatCen Social Research, 46% of Londoners hoping to buy their first home said that high house prices in their area were preventing them from getting on the housing ladder, compared with 22% of first time buyers in the rest of the UK.
Londoners saving for their first home were also more likely to be living in lower quality or shared housing in order to save money on rent, with 23% saying they had moved to cheaper accommodation, compared with 15% for the rest of the country.
Another 11% said they had moved back in with family in order to get their deposit together, according to the report.