First-time buyer prices and rents have jumped three times faster than equivalent pre-pandemic levels, with asking prices up £17,557, according to analysis from Rightmove.
The average price of a first-time buyer property hit a new record of £224,943 as the average deposit required by such as buyer increased by £2,560 from what was needed two years ago.
Between July 2018 and July 2020, the average deposit needed by a first-time buyer only increased by £807.
Meanwhile, monthly rental payments are up 17%, or £128, higher than they were two years ago on average. During the same timescale, average earnings increased by 14%.
Tim Bannister, director of data services at Rightmove, said: “Our affordability analysis highlights the many challenges first-time buyers are trying to navigate right now.
“For would-be first-time buyers who are trying to save up a deposit, they are chasing a fast-moving target as average asking prices for first-time buyer homes hit another new record, and rise more quickly than they did before the pandemic.
“For those that aren’t able to live with parents or family members while saving, they also have to manage paying record rents both inside and outside of London.
“We understand how difficult this challenge can be, and something we’ve seen more of over the last couple of years, particularly with working from home becoming more common, is people looking further away or at a greater number of different areas when looking to move, to see what is available within their budget.
“Those that have been able to save up a deposit are now facing rising interest rates when considering what they can afford to repay each month.
“Given the economic uncertainty at the moment, first-time buyers may seek some financial certainty by locking in a longer fixed-rate mortgage term now, before interest rates rise again.”
