First-time property buyers in London are parting with twice as much money for their new homes compared to the rest of the U.K., according to a report Wednesday from Lloyd’s Banking Group.
Novice buyers in the city are now spending an average of £420,132 (roughly US$560,000) on their homes, an increase of 64% from the £255,794 (US$340,739) that was being spent in 2013.
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The average cost of a first-time home in the rest of the U.K. currently stands at £210,515 (US$280,423), the report said.
Meanwhile, the typical deposit used to buy a first London home has soared, too, up 62% to £92,833 (US$123,661). That’s compared to five years ago when buyers were putting down an average of £57,434 (US$76,506), and significantly more than the deposit used by the rest of the U.K., £39,668 (US$52,841).
"Despite the recent slowdown in London house prices, this latest data shows how expensive it has become to live in the capital, particularly for young people trying to get on the ladder for the first time," said Andrew Mason, Lloyds Bank mortgage products director, in the report. As a result, first-time buyers have to wait until they are 34, on average, before getting their first foot on the property ladder, Mr. Mason said.
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Since 2013, the number of buyers getting on the capital’s housing ladder has fallen by 5% to 42,983 in 2017, according to the report. While the number of London’s first-time buyers has fallen for three consecutive years—likely due to increased prices—the overall number of first-time buyers has increased for six years straight across the rest of the U.K.
The most expensive spot for first-time buyers in the capital is Westminster, the report found, where average prices stand at £641,953 (US$855,135), an increase of 47% from 2013.
Waltham Forest logged the largest price growth, though, as the average cost for a first- time buyer soared 94% from 2013 to a £409,977 (US$546,124).