It won’t come as a surprise to many that the amount of money that home buyers have to earn to be able to afford to buy a property these days is getting higher and higher. According to the Office for National Statistics the typical buyer of a new build home in the first quarter of this year earned £50,000! The good news is that this was lower than the £56,000 they typically earned in 2006 ahead of the Credit Crunch.
At the same time the the income of borrowers who are first time buyers crept back up in Q1 to £43,000. Remember that the average salary in the UK is only about £27,000.
Meanwhile the ONS have also made available some other numbers showing the deposits required by both first time buyers and those buying their second (or third) home. As we know, 110% loan to value mortgages available back in 2006 are now a distant memory. As the graph shows, borrowers now need to put down 25% on average with former owner occupiers typically stumping up 37%.
