It’s no secret that properties are now more expensive than ever, but wages are also up too, so does that mean getting on the property ladder is easier or harder for first time buyers compared to 20 plus years ago?
Well, that’s a question that South Wales-based Howells Solicitors has sought an answer to.
In a recent guide, the conveyancing specialist has delved into government data to reveal that our parents’ generation did have it easier.
Properties Are Less Affordable Than 20 Years Ago
According to the Office for National Statistics and the Annual Survey of Hours and Earnings (ASHE), the median gross weekly earnings has grown from £268.90 to £438.60 over the last twenty years. However, the average UK home has grown from around £60,000 to £223,257 in the same time frame.
Over the last decade alone, median individual annual earnings grew 68%, whereas residential property prices in England and Wales increased 259%.
Although other cost such as interest rates are now considerably lower, this out of proportion increase has meant buying a home has become more difficult. In 1997 the average prospective homeowner could expect to pay up to 3.6 times their earning on buying a home. Last year, the average person needed more than double this at 7.6 times their earnings.
So, buyers today will likely find it considerably harder to get onto the property ladder than twenty years ago – especially since we’re suffering a housing shortage. However, all is not lost. Government housing schemes, such as Help to Buy, are tackling the issue straight on.
Tristan Lewis, Business Development Manager of Howells Solicitors, has commented on the results of the study. He said:
“With property prices considerably higher than twenty years ago, we have become familiar with the requirements of first time buyers for an affordable conveyancing service during these demanding times. However, the comparison of these values against income data has reiterated this further.
To combat these issues, Howells offers a fixed fee conveyancing service with no hidden extras and a no sale, no fee policy. We pride ourselves on making moving home as straight-forward as possible and look forward to helping even more people purchase their first home.”
For further stats on house prices, the average age of first time buyers, and number of first-time mortgage applications, read the full report: Historic House Prices: Research Shows Your Parents Definitely Had it Easier.
