Six out of ten Londoners rent or live with parents
Home ownership is less prevalent in London than any other part of the UK, new research from Alliance & Leicester. Sixty per cent of Londoners – the highest of all UK regions – either rent or still live at home with their parents.
The study reveals that almost four in ten people (39 per cent) in London own their own home compared with nearly seven in ten people in the North East (69 per cent), West Midlands (68 per cent) and Wales (66 per cent).
There are more people looking to get onto the housing ladder in London when compared with the national average; the research shows that 14 per cent of renters and those that live with their parents in London are looking to buy their first home, compared with just ten per cent across the nation.
Although Londoners have big aspirations to buy a house, they find that home ownership is still out of their reach. Nearly one-third (31 per cent) of those who rent or live with their parents want to buy but say they can't afford it. This is higher than the national average at 28 per cent.
Stephen Leonard, Director of Mortgages at Alliance & Leicester says, ‘London is not only the most expensive region to buy a house in the UK but also one of the most expensive in the world. Many choose to rent or continue to live with parents in order to keep a roof over their heads. However, Londoners have buoyant aspirations and we can see that there is a thriving first time buyer market.’
Stephen Leonard continued: ‘Despite these aspirations, many first time buyers feel that they cannot afford to buy a home, and whilst these fears aren't unfounded, with the average house in London at £263,525 compared with £181,832 nationally, they should take heed that there are some fantastically competitive deals available and some that are especially designed with first-time buyers in mind.’
Faced with the choice of renting or buying, Londoners are least likely to want to buy of all the regions. Of those that would rather rent, a third (33 per cent) think that a mortgage is too much of a commitment; this is twice the national average (17 per cent).
First-time buyers priced out of countryside
The percentage of first-time buyers in rural areas has dropped sharply in the past ten years, according to Halifax’s new English Rural Housing Index.
Whereas first-time buyers accounted for 27 per cent of rural property transactions in 1994, last year’s figure was 16 per cent. Over the same period the number of first-time buyers in urban areas fell from 41 per cent to 35 per cent.
The lowest proportion of first-time buyers can be found in Dorset, where they account for only seven per cent of total rural transactions. The highest proportion, at 43 per cent, is in the Forest Heath local authority in the East of England.
Looking at the ability to buy, North Cornwall is the least affordable; there the average house price, at £217,276, is almost 14 times average local earnings. The the local authority with the most affordable homes is Copeland in Cumbria, where the average house price is £110,422, almost five times average local earnings.
Housing in rural areas has outperformed the rise in urban house prices over the last ten years. In 1994, the average rural house price was £85,308 rising by 171 per cent to £231,053 in 2004. In comparison, the average urban house price has risen by 166 per cent over the last ten years – from £73,960 in 1994 to £197,051 in 2004.