Acute housing affordability challenges continue to persist, as the proportion of local authority areas in England where the average first-time buyer home falls in scope of Stamp Duty almost quadrupled in April, research from Skipton Building Society has revealed.
Skipton Group’s Home Affordability Index has reaffirmed data released this week by the Building Societies Association (BSA), revealing that a significant number of potential first-time buyers have failed to get on the property ladder since the financial crisis.
These findings are part of an update to the comprehensive ‘First-time buyers: age old problems, modern solutions’ report that was published last year, supported by the Skipton Group.
Today’s first-time buyers face a double affordability challenge – an almost record-high cost of buying a home and the end of record-low mortgage rates.
Skipton’s data showed one of the biggest challenges for first-time buyers is around affordability – with 90% unable to buy a typical first-time buyer home in their local area.
Many were currently stuck in the private rented sector (PRS), where rental repayments as a proportion of income are significantly higher than mortgage repayments – even when the recent rise in mortgage rates has been considered.
Last month, Skipton Group brought together senior stakeholders from across the financial services and housing ecosystem at a Parliamentary reception at the House of Commons, focused on solving the UK’s pressing home affordability challenge for both renters and home buyers.
Jen Lloyd, head of mortgages at Skipton Building Society said: “Our Home Affordability Index completely reinforces the findings from the Building Societies Association, the country has a chronic lack of home affordability and last month’s reforms are undoubtedly making things much tougher.
“Significantly more first-time buyers are having to find additional funds, and we recognise the real financial struggles and anxiety this is undoubtedly causing people.
“We’re doing all we can to play a meaningful part in tackling this issue – from designing new mortgages through to recently sharing our findings and thinking directly in Westminster.
“Only actions, not words will change this and what’s needed is genuine collaboration across Government and the wider housing industry to solve what is ultimately a systemic issue.”
