Top LAD: Camden named one of the least affordable local authority districts for first time buyers

First time buyers now account for 47 per cent of the market according to Halifax

First time buyers now account for 47 per cent of the market according to Halifax - Credit: Getty Images/iStockphoto

New low for London’s first time buyer hopes as house prices hit record highs, with the average price of a first home up 66 per cent

Camden is the fourth most unafforable borough for first time buyers (FTB), with house prices now 11.8 times average earnings according to Halifax.

Brent came top of the list with house prices 12.5 times average earnings, whilst Haringey came in third place with 11.9 per cent ratio.

The average price of a FTB home in London has risen 66 per cent in the last five years to £409,975, the highest figure on record and nearly double the £208,693 paid in the rest of the country.

London’s homes are over £130,000 value of the second most expensive region in the South East.

FTBs are now the driving force behind the mobility of the housing market, with 162,704 young entrants in the market in the first six months of this year, up 8,500 from the same period last year and double that of 2009.

All ten of the least affordable Local Authority Districts for first time buyers were in London.

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Young buyers will have to stump up deposits of £106,577 in the capital, a 26 per cent share of the purchase price, over three times the average paid in the rest of the country at £32,899 in the first half of this year based on 16 per cent.

The average deposit for London first timers has quadrupled from £26,701 to £106,577 in the last ten years.

FTBs are now outperforming the rest of the market by 42 per cent. Help to Buy has played no small part in the growth, with FTB’s share of the market increasing by 3 per cent to 47 per cent since the introduction of the policy in 2013. However, growth has slowed to 3 per cent in contrast to the 10% achieved last year.

FTBs now make up just under half of all purchases financed by a mortgage. The increase in share of the market held by FTBs has been matched by an increase in the length of the terms of a mortgage. In 2007, just under half of FTBs took out a mortgage lasting between 20 and 25 years. In 2016, 56 per cent took out mortgages lasting between 25 and 35 years. The average mortgage in London costs £303,218 compared to £174,495 in the UK as a whole.

Martin Ellis, housing economist at Halifax, said: “Although the number of first-time buyers grew at a slower rate in the first half of the year compared to 2016 the levels remain healthy and the market is achieving record average house price for first-time buyers.

“For the third time in four years the numbers getting on the housing ladder have exceeded 150,000–a level of momentum not seen since before the financial crisis.

“High levels of employment, low mortgage rates and government schemes such as Help to Buy have also helped these numbers remain robust, as FTBs continue to form a fundamental part of the UK housing market.”

For those who are not content to rent, prices in the country as a whole have risen 4 per cent in the past year and doubled in the past five to £207,693.

The most attractive prospect in the country for aspirational homeowners is Scotland, where seven of the 10 most affordable regions are found.