As house prices stagnate and even fall in London, new research has revealed the capital’s most affordable spots for first-time buyers (FTBs).
According to data from the Office for National Statistics (ONS), overall property prices across London fell by 2.7 percent compared to 12 months ago with flat prices showing the sharpest drop of all at 4.3 percent.
The research shows the average deposit is now more than £100,000 in the capital, and even with schemes such as Help to Buy, many newcomers to home ownership simply cannot afford to buy in London.
Savills and Zoopla looked at average incomes for 18-30-year-olds in each borough and compared those to the average price of a flat or terraced house locally.
The most affordable area is Beckton in the borough of Newham where the average price for a flat or terrace is £161,267. The average salary is just over £55,000 in Beckton.
Next most affordable is Island Gardens in Tower Hamlets. There the average salary among the younger demographic is £97,000, and that is reflected in the average price of a flat or terrace at £284,042.
Chelsfield and Pratts Bottom in Bromley and Kenley in Croydon are also within reach of FTBs. Flats and terraces in these areas cost 3.25 times the average salaries for 18-30-year-olds – the Bromley average property price is £220,604 and in Croydon £201,770.
The research revealed that even in the more expensive boroughs, FTBs on higher-than-average salaries can still get on the property ladder.
For example, the North End ward in Hammersmith and Fulham has flats or terraces selling for an average £520,000, fives times the average salary for younger people.
Lawrence Bowles conducted the research for the Telegraph. He said: “As many young people in London share properties, rather than living by themselves, household incomes can be rather high.
“But that doesn’t mean those households can or want to buy together, which partly explains why many are still struggling to get on the property ladder.”
And Richard Donnell, head of research at Zoopla, said: “While affordability in London has improved, deposit levels remain over £100,000, making schemes such as Help to Buy London an attractive proposition.”
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