House price growth may be showing signs of slowing down, but it can't be denied that they're still on the up – yet wages aren't exactly keeping pace. As a result, the average price of a home in the UK is now eight times the average wage, so it's little wonder so many people find it difficult to get that first foothold on the housing ladder.
The figures, from eMoov.co.uk, show that the average UK house price stands at £216,750, while the average wage comes in at £27,440. Unsurprisingly, this disparity is most keenly felt in London, where average house prices (£484,716) are 14 times the average wage (£34,320). Within that, the borough of Kensington and Chelsea has by far the highest disparity with the average house price at £1,212,375, a whopping 46 times the average wage (£26,624).
The London effect has driven the disparity in England, resulting in the average house price (£232,885) being nine times higher than average wages (£26,884). Meanwhile, Scotland has the lowest price-to-wage ratio with house prices (£143,711) being around five times wages (£27,404), while the average price of a property in Wales (144,828) is six times higher than the typical wage (£24,617).
"Property values in England are significantly higher than the rest of the UK," said Russell Quirk of eMoov.co.uk. "However, wages are not always consistent with property prices and have failed to increase at the same pace, [which] highlights the unaffordability of the market."
So what can you do? The key is to not panic! Being able to afford your own home may seem an impossibility when looking at the figures, but all may not be lost.
First of all, remember that the house prices given are just an average, and that there's a huge variation in terms of the prices and kinds of property available. Those suited to a first-time buyer, for example, will often come in well below the average, so the first thing you should do is research the market to see the kind of properties (and prices) in your area.
Once you've got an idea of the property you're aiming for and the kind of deposit you'll need as a result, you can start saving. It's possible to get a mortgage with just a 5% deposit, but you'll probably want to save more than that to account for legal fees, estate agents and associated moving costs, so just bear that in mind when you set your savings goal.
Read our guide on saving a deposit for a house or flat and be on the lookout for ways to save at every opportunity – put it all in a dedicated savings account and you'll soon see your balance grow. Keep an eye on the top first-time buyer mortgage deals, and once you've saved up enough, take the plunge and apply! With a bit of research and forward planning, the fact that average prices are higher than wages hopefully won't put you off.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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