Unsurprisingly, London is the most expensive place in Britain for first-time buyers looking to get on the property ladder, according to a report Wednesday from U.K. property website Zoopla. But the capital city is followed in the unaffordability ranks by Cambridge, Brighton, Colchester and Reading.
Zoopla collates their rankings using several data points from February, including average property prices, typical deposit amounts in each area and applicable Stamp Duty Land Tax relief.
Buyers in the capital city can expect to pay £518,178 (US$720,376) on average for a home with a deposit as high as £77,727 (US$108,056), but at that price, they’ll receive no Stamp Duty tax relief.
The recent Stamp Duty Land Tax relief, which was enacted in November, allows first-time buyers to make a tax-free property purchase up to the value of £300,000 (US$417,063). From £300,001 (US$417,064) to £500,000 (US$695,105), first-time buyers would pay 5% tax and if the property exceeds £500,000, standard rates apply (with a cap at 12.5%).
The second most expensive area in which to purchase is Cambridge, which like London, is in southern England. Property purchases in the city famed for its university require an average deposit of £65,716 (US$91,359), with homes costing around £438,109 (US$609,063), though new buyers can expect a tax relief of £5,000 (US$6,951) for a property at that price.
“Prices in Southern England have continued to rise at a relatively fast rate, making it very difficult for the average first-time buyer to get on the property ladder,” said Lawrence Hall, spokesperson for Zoopla, in the report.
An overall look at the cities included in the report reveals a clear North-South divide. Eight out of the 10 most expensive cities for first-time buyers are located in the South (London, Cambridge, Brighton, Colchester, Reading, Bedford, Bournemouth and Milton Keynes). Six of the 10 most affordable cities are in the North, led by Hull.
First-time buyers in Hull can expect to pay an average of £104,376 (US$145,104) for a property and a deposit of £15,656 (US$21,765).
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