Babies born today risk paying £500,000 for home
Research from Lomond, one of the biggest estate and letting agency groups in the country, has found that a baby born today would need to earn £95,121 to get on the property ladder and the average first-time buyer house price may cost as much as £503,584 by the time they reach the average age of a first-time buyer of 31.
Lomond examined the current average age across each region of the country, analysing historic house price data to forecast what the price could be for a someone born today when they reach the current average age of a first-time home buyer. The research shows that the average age is currently 31 years old. This means that someone born today would be unlikely to own a home until 2055.
Looking at historic house price growth over the last 31 years, Lomond estimated that the average first-time buyer house price could reach £503,584 by 2055. That represents a 111.9% increase on the current average of £237,655 spent by a first-time buyer.
If this forecast comes true, the average baby born today would end up with a steep climb to get on the property ladder. They would need a mortgage deposit of £75,538 at 15% of property price and have to earn as much as £95,121 just to be eligible to borrow the mortgage at 4.5 times income.
For London, it’s even worse. Lomond predicts that house prices in the capital could almost reach £1 million. As expected, the capital would face the highest financial hurdle for first-time buyers in 2055, with prices expected to reach almost £1 million by 2057. They would therefore need to put down £144,630 and need an income of £182,126 just to get their first foot on the property ladder.
