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​State of the FTB Market: 56% of UK properties are affordable for first-time buyer

Press release -

​State of the FTB Market: 56% of UK properties are affordable for first-time buyer

  • Post Office Money annual study reveals the hotspots and coldspots for first-time buyers looking to get on the ladder
  • Post Office Money reveals the most affordable places in the UK with Blackpool, Southampton and Greater Manchester towns such as Wigan and Oldham topping the list
  • First-time buyer coldspots revealed in the historic cities of Oxford, Cambridge and York
  • The average house price (£282,713) still sits at 5.85 times the average first-time buyer income
  • Post Office launches online tool that helps aspiring homeowners find the areas most affordable to them in their desired location and map their deposit-savings journey

Post Office Money today revealed that 56% of properties across the UK are in areas that are affordable for FTBs. The research, based on analysis of Office for National Statistics (ONS) data, examines the FTB affordability of over 80 locations across the UK1.

While house price growth has continued, in the last year it has stagnated to an increase of just 0.9% across the UK, with the average home costing £282,713. At the same time first-time buyer household incomes across the UK increased by 1.2% to £48,289, meaning that, the average house price still sits at 5.85 times the average first-time buyer income. However, the Post Office research has uncovered many affordable locations across the country for FTBs to explore.

Affordability hotspots

Affordability peaks in Blackpool where the average property price is £110,000, compared to the average FTB household income in the North West of £40,053, meaning 100 per cent of properties in the area are deemed affordable to new homeowners. Lincoln and Hull were also among the UK’s ‘affordable hotspots’, both having 100% of properties in areas considered affordable to FTBs.

Top 10 most affordable areas for local first-time buyers

County City Average house price 1-year
change
FTB income % of city affordable
1 Lancashire Blackpool £110,000 -2% £40,053 100%
2 Lincolnshire Lincoln £149,000 +4% £40.913 100%
3 East Yorkshire Kingston upon Hull £115,000 +4% £38,665 100%
4 Merseyside Knowsley £163,000 +5% £40,053 95%
5 Staffordshire Stoke-on-Trent £116,000 +5% £41,796 94%
6 Hampshire Southampton £215,000 +2% £57,557 94%
7 West Midlands Sandwell £148,000 +8% £41,796 92%
8 County Durham Hartlepool £124,950 0% £36,674 92%
9 Greater Manchester Wigan £137,500 +4% £40,053 90%
10 Greater Manchester Oldham £130,000 +2% £40,053 88%
[Full data of over 80 locations in notes to eds]

Shifts in affordability

In the last year, Rotherham has seen the biggest shift in affordability for FTBs. While the number of affordable properties has shrunk by a fifth (18%), 79% of neighbourhoods in the city are still affordable for the average FTB’s budget, which means it’s still a good option for local aspiring homeowners. This has been driven by wage-growth in the area fuelling the number of potential FTBs and increasing demand. Meanwhile, prospective house hunters in Ipswich have seen the most opportunity over the course of the last year, with the biggest increase in the number of properties in areas affordable to FTBs; a 6% increase to 88%. This is a result of the trend for falling house prices in the South of England, the first time prices have fallen in the region since the last recession in 2009. This has been attributed to a number of economic factors including Brexit uncertainty.

For those lucky enough to purchase a property in Nuneaton and Bedworth in the West Midlands, in the last year they will have seen the best return on their investment, with average property prices increasing by 11% to £179,995. This increase has had an impact on the affordability for prospective buyers, who will have seen the average property price rise by £9,800 and £7,500, respectively, in just one year in the East and West Midlands.

Commuter towns

On the whole, popular commuter hubs in the South continue to make up the majority of least affordable locations for FTBs in the UK, with Cambridge, Woking and Surrey all seeing a lack of opportunity for local FTBs. Oxford ranks as the least affordable commuter location for new homeowners, with average property prices reaching £392,500 and with no properties currently in areas considered affordable to FTBs.

However, one of last year’s least affordable locations, commuter hub Reading, has seen a 6% rise in the number of properties in the region which are affordable for FTBs. The area had no properties in areas considered affordable in the region in 2017, but rising wages in the South East coupled with lower house prices in certain areas has opened up part of the city to new homeowners. Similarly, locations within a short distance of Manchester – Wigan and Oldham – are some of the UK’s most affordable areas for FTB commuters at 90% and 88% affordability, respectively. This could be due to an increase in housing stock and affordable home schemes in both areas.

Ross Hunter, Post Office Money comments: “While we have seen house price growth slow in the last year, properties can still seem particularly unaffordable for first-time buyers. We know that saving for a deposit remains the most significant hurdle for young buyers to overcome in order to achieve their homeownership aspirations. It can take years of dedicated effort in order to gather the necessary funds. There are a number of ways that prospective homeowners can reduce their time spent saving, such as taking on a fixer-upper property or looking in a cheaper area close to where they might have previously considered. Post Office also offers two innovative products, Family Link and First Start, which can enable buyers to get on to the ladder with a lower deposit.”

“While we may be seeing the first indications of a ‘buyer’s market’, we still know that saving for and ultimately purchasing a home is a difficult process. Finding which areas are most affordable in cities local to you is key to making a personal plan of action. Post Office Money provides a tool that allows FTBs to hunt for their most affordable local areas and also figure out how long they it will take them to save for their deposit: https://www.postoffice.co.uk/mortgages/deposit-calculator .”

ENDS

1 Opinium Research was briefed by Post Office Money to conduct a study into the affordability of properties for first-time buyers in the UK, covering over 80 locations across the UK

The percentage of each city that is affordable to first time buyers was calculated by seeing what proportion of the middle layer super output areas (MSOA) in each local authority had a median house price lower than 4.5 times the average income of first-time buyers in each region.

Property price data sourced from the ONS House Price Statistics for Small Areas, quarterly statistics from the Registers of Scotland and the Northern Ireland Residential Property Price Index. Data on first time buyers’ salaries in each region sourced from the ONS House Price Index.

Affordability data across more than 80 locations:

County City Average house price 1-year
change
FTB income % of city affordable
1 Lancashire Blackpool £110,000 -2% £40,053 100%
2 Lincolnshire Lincoln £149,000 +4% £40.913 100%
3 East Yorkshire Kingston upon Hull £115,000 +4% £38,665 100%
4 Merseyside Knowsley £163,000 +5% £40,053 95%
5 Staffordshire Stoke-on-Trent £116,000 +5% £41,796 100%
6 Hampshire Southampton £215,000 +2% £57,557 94%
7 West Midlands Sandwell £148,000 +8% £41,796 92%
8 County Durham Hartlepool £124,950 0% £36,674 92%
9 Greater Manchester Wigan £137,500 +4% £40,053 90%
10 Greater Manchester Oldham £130,000 +2% £40,053 88%
11 West Midlands Wolverhampton £149,995 +7% £41,796 88%
12 Suffolk Ipswich £195,000 +5% £53,263 88%
13 South Yorkshire Doncaster £129,995 +0% £38,665 87%
14 Merseyside St. Helens £133,417 +1% £40,053 87%
15 Nottinghamshire Nottingham £137,500 +6% £40,913 87%
16 South Yorkshire Barnsley £130,000 +4% £38,665 87%
17 Tyne & Wear Sunderland £127,500 +2% £36,674 86%
18 Greater Manchester Rochdale £132,500 +2% £40,053 84%
19 West Yorkshire Bradford £136,000 +3% £38,665 84%
20 Greater Manchester Tameside £140,750 +2% £40,053 83%
21 Tyne & Wear South Tyneside £139,000 +3% £36,674 83%
22 Cambridgeshire Peterborough £185,000 +6% £53,263 82%
23 West Yorkshire Calderdale £142,000 +5% £38,665 81%
24 Tyne & Wear Gateshead £139,995 +6% £36,674 81%
25 Merseyside Liverpool £125,000 0% £40,053 80%
26 Hampshire Portsmouth £214,000 +4% £57,557 80%
27 Greater Manchester Bolton £135,000 +5% £40,053 80%
28 West Midlands Walsall £156,748 +5% £41,796 79%
29 South Yorkshire Rotherham £140,000 +4% £38,665 79%
30 Clwyd Wrexham £155,000 +5% £37,460 78%
31 Cumbria Carlisle £140,000 +1% £40,053 77%
32 Warwickshire Nuneaton and Bedworth £179,995 +11% £41,796 76%
33 County Durham Stockton-on-Tees £145,000 +1% £366,74 75%
34 West Yorkshire Wakefield £153,000 +5% £38,665 73%
35 Greater Manchester Salford £161,000 +2% £40,053 73%
36 County Durham Darlington £140,750 +2% £36,674 73%
37 West Yorkshire Kirklees £150,000 +4% £38,665 73%
38 Devon Plymouth £178,000 +5% £45,547 72%
39 Norfolk Norwich £190,000 +2% £53,263 71%
40 Glamorgan Swansea £142,000 +1% £37,460 71%
41 Leicestershire Leicester £172,000 +10% £40,913 70%
42 West Midlands Dudley £164,500 +4% £41,796 70%
43 Shropshire Telford and Wrekin £167,250 +3% £41,796 70%
44 Scotland Glasgow £130,669 +3% £39,686 70%
45 West Midlands Coventry £179,950 +8% £41,796 69%
46 Tyne & Wear Newcastle upon Tyne £161,995 +5% £36,674 69%
47 West Midlands Birmingham £175,000 +6% £41,796 69%
48 South Yorkshire Sheffield £159,995 +7% £38,665 67%
49 Gwent Newport £165,500 +5% £37,460 65%
50 Derbyshire Derby £155,000 +5% £40,913 65%
51 Merseyside Wirral £160,000 +2% £40,053 64%
52 Greater Manchester Manchester £172,748 +5% £40,053 61%
53 Merseyside Sefton £169,950 +4% £40,053 61%
54 Cheshire Warrington £183,500 +3% £40,053 56%
55 Greater Manchester Bury £167,000 +4% £40,053 54%
56 Gloucestershire Gloucester £193,000 +4% £45,547 53%
57 West Yorkshire Leeds £177,000 +4% £38,665 50%
58 Worcestershire Worcester £197,500 +4% £41,796 50%
59 Tyne & Wear North Tyneside £169,995 +1% £36,674 47%
60 Wiltshire Swindon £230,000 +5% £45,547 41%
61 Buckinghamshire Milton Keynes £283,000 +5% £57,557 41%
62 Glamorgan Cardiff £202,000 +9% £37,460 31%
63 Greater Manchester Stockport £225,000 +10% £40,053 31%
64 Northamptonshire Northampton £205,000 +5% £40,913 29%
65 Bedfordshire Luton £245,000 +2% £53,263 24%
66 Dorset Bournemouth £250,000 +4% £45,547 22%
67 Kent Maidstone £312,500 +5% £57,557 21%
68 London London £538,132 0% £79,834 19%
69 Essex Southend-on-Sea £280,000 +5% £53,263 18%
70 West Midlands Solihull £273,000 +3% £41,796 17%
71 West Sussex Worthing £295,000 +5% £57,557 15%
72 Avon Bristol, City of £265,000 +2% £45,547 7%
73 Greater Manchester Trafford £264,000 +6% £40,053 7%
74 Scotland Edinburgh £261,812 +8% £39,686 6%
75 Berkshire Reading £308,000 +1% £57,557 6%
76 Somerset Bath and NE Somerset £327,500 +3% £45,547 4%
77 North Yorkshire York £237,500 +3% £38,665 0%
78 Cambridgeshire Cambridge £427,500 -1% £53,263 0%
79 East Sussex Brighton and Hove £352,500 +1% £57,557 0%
80 Hertfordshire Watford £365,000 0% £53,263 0%
81 Oxfordshire Oxford £392,500 -2% £57,557 0%
82 Surrey Woking £390,000 -4% £57,557 0%
83 Surrey Guildford £450,000 +5% £57,557 0%
84 Warwickshire Warwick £305,000 +5% £41,796 0%

Notes to Editors:

For more information, please contact:

Lily Cunningham, PR & Campaigns Manager Post Office

Lily.Cunningham@postoffice.co.uk

Twitter @postofficenews

Lansons

PostOffice@lansons.com

0207 566 9702


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