How would you feel if you were a first-time buyer and you needed to find a million pounds to own your first home? Stroud & Swindon Building Society have calculated that that could well be the case in just 17 years time.
As property price continue to rise unabated affordability will be pushed right out of reach for aspiring homeowners. They suggest that average income would rise to £136,000 by the same time, but it would still leave an in come mutiple of seven times to buy your first house, and you would still need a 5% deposit of £50,000.
The million pound first-time property by 2024 is an average forecast for the whole of the UK. If you live in the ‘wrong’ area the time could be a lot nearer. For example, if you want to buy your first home in Lonodn, then you’re likely to be asked to find a million as soon as 2018. Similarly, in Northern Ireland it’s going to be 2018 with the current rate of house inflation. Northern Ireland has come so far in a short space of time that it was only last year that a million wouldn’t be needed for a property in the province until 2025. Now that time has copme seven years closer in the space of 12 months.
Stroud & Swindon worked out their forecasts by taking the rate of house inflation between 1997 and 2007 and applying it forwards. Life doesn’t always work like that, of course, and it’s iunlikely our salaries will rise as predicted either. Nevertheless, the million pound first-time house is going to arrive one day, and in 2024 we may marvel at the golden days of 2007 when you could buy a house for less than a quarter of a million. “Small change†by then!
There was no region where last year’s predicted dates for the million pound first-time buyer house was pushed further out in time. Most regions saw the time come nearer by three of four years.
First-time buyers are finding affordability harder all the time, and most will have to put off buying a house for longer. Saving for a deposit sounds like a good idea – the first million is the hardest!
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