Is it really getting easier to buy a house?
A new report has revealed that it has been becoming easier for Brits to buy a home over the past year despite it being marginally. However it is not good news for everyone though as there is a massive variation across Britain.
This new found affordability in limited areas, is supposedly due to an increase in wages combined with tax-free personal allowance and lower costing essentials. According to the Hamptons International buy-to-let index, the people of Britain’s ability to afford a home was 2% better between July to September in comparison with the previous year.
The index from Hamptons International - which takes into account numerous factors- calculated that some areas are finding they’re more able than others when it comes to buying houses. For example, potential buyers in the North East and Wales are finding it much easier. After shelling out for taxes, a mortgage and all the necessities, households within the North East have £175 left per month compared to the typical British household which only has £69. Households in Wales are £123 better off per month. To put this in perspective, people who live in the capital overspend by about £10 every month.
People in the North East witnessed the biggest increase in their ability to buy a home due to a 0.2% decrease in house prices and a 5% rise in wages. However, the ability to buy was the worst in the South East where the exponential growth in house prices will continue to outweigh the increase in people’s wages.
Fionnula Earley the director of residential research at Hamptons International said “While it’s encouraging that ability to buy is getting better year-on-year, with prices 5.5 times higher than incomes, it’s still very expensive to buy and home, and out of reach for many first-time buyers”. She continued to suggest that “The key to better affordability is for wages to increase substantially faster than house prices”.
Aislinn Devlin, Pali Ltd
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