As has been previously highlighted, concerns are abound as to the affordability of property in the London areas, and most specifically for those looking to break into the property market. Highlighting this concern yet further, it has been shown in a recent research report by My Home Move that the average deposit for a property in Greater London is presently at a value almost three times that perceived around the rest of the UK.
Totalling in at a staggering £127,000, the average deposit for a property in the area has been reported to have increased by almost a third over the course of the past three years, with an increase of £30,000 reported. Yet, the average deposit as a proportion of price has actually fallen by 1.8% since 2013.
Effectively, the evolution of the marketplace means that buyers are still able to get the same level of optimism when purchasing a property in Greater London, if not one marginally higher due to the reduced proportion of property price required for a deposit. Yet, on the other hand, the stark increase in the actual value of a deposit required does indeed paint a worrying picture as to just how many “average” people will be able to stretch to this new “average” deposit for the area.
Regarding the situation as becoming somewhat “extreme”, My Home Move’s Chief Executive, Doug Crawford nodded towards the typically price-demanding nature of the London property market, yet inspired a sense of urgency as to just how far this seems to be progressing.
“This situation is unsustainable and has been driven by rising house prices. For some, their deposit will come from the equity in the property they are selling,” he commented. “However, for many, they will still need to save tens of thousands of pounds to make the move onto and up the property ladder.”