House prices: average flat value jumps lb75,000 in 5 years

New research has revealed the average UK flat price has risen by lb75,074 over the last 5 years.

The average cost of a flat increased from lb157,061 in 2013 to lb232,135 in 2022, up 48%, according to Halifax.

Despite the phenomenal rise in worth of flats, the majority of property sales this past year (six in ten) were for either terraced or semi-detached houses.

Over the same five-year period, terraced houses grew in value by lb60,482 (41%) while semi-detached homes increased by lb73,638 (27%).

Below, we glance at what this signifies for first-time buyers hoping to get onto the property ladder.


Most popular types of property for first-time buyers

Terraced houses would be the most popular property type among first-time buyers.

With an average price of lb208,311, the least expensive of all of the property types, terraced properties were bought by 37.3% of first-time buyers in the year ending March 2022.

Bungalows, which in fact had a typical price of lb254,313, were minimal popular property type. Only 3.4% of first-time buyers opted for one of these.

The graphic below shows the most popular property types bought by first-time buyers and the average cost.

Most affordable areas for first-time buyers

Analysis through which? using data from the ONS and the Land Registry revealed the most and least affordable areas for first-time buyers to live.

The most affordable areas for first-time buyers to get to the property ladder were spread across Wales and also the North West of England.

Copeland, Cumbria, arrived as the least expensive area to live, in which the average first-time buyer house price, lb104,900, was 2.22 times the typical annual salary.

The second-most-affordable position for first-time buyers was Blaenau Gwent in Wales, in which the average first-time buyer house price stands at lb79,439, 3.24 times the typical salary.

Barrow-in-Furness, Cumbria, was the 3rd most affordable area to live, using the average first-time buyer house costing lb105,652, 3.29 times the typical salary.

Least affordable areas for first-time buyers

The least affordable areas for first-time buyers were concentrated working in london and also the East.

Kensington and Chelsea took top spot as the least affordable area to live. At lb1.2m, the average first-time buyer house price in the London borough was equal to a staggering 22.54 times the average annual salary.

Second place visited Westminster, where the average first-time buyer paid lb954,080, that is 22.54 times the typical salary.

Hammersmith and Fulham came in third, using the average first-time buyer house price, lb638,572, being 17.33 times the average salary.

First-time buyer mortgages

Getting a home loan for a property can feel like a daunting task, especially if you’re buying within an expensive area.

As an over-all rule, lenders are allowed to loan as much as four-and-a-half times the entire salary of you and also anyone else you’re buying with.

This means that, in the current property market, workers in places such as London and the East may have to look a little further afield to purchase their first home.

First-time buyers also need to save for any deposit of at least 5%, which may be challenging.

100% mortgages

If saving a deposit seems impossible, a 100% mortgage might be an attractive option.

There are two types of 100% mortgage available on the market right now: guarantor mortgages and family deposit mortgages.

Both require financial resources out of your family in order for you to definitely secure the borrowed funds.

Finding the best mortgage deal

It’s important to exercise precisely what you can afford before you start looking for a mortgage.

Using tools such as a mortgage repayment calculator will help you determine what your repayments could be at different rates.

Once you’ve got your estimate mind, make sure you shop around and don’t go for which seems like the cheapest option, as it might 't be suitable in the long term.

Getting independent advice from the mortgage broker can also help you to create a plan and see which deals are perfect for you.

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