Just 12.5% of renters can afford to buy, warns Connells parent firm

Skipton Building Society says housing affordability is now 'bleak' for most first time buyers and urges Labour to act swiftly.

Only one in eight renters can afford to buy the average first-time buyer house in their area, new research from Skipton Group, which owns the Connells Group, reveals.

Almost 80% of potential first-time buyers don’t have enough savings for the deposit needed to get onto the local property ladder, with affordability levels the worst in the West Midlands – driven by a combination of low deposit levels and moderate house prices – London – due mainly to high house prices – and Wales, where lower income levels reduce households’ buying potential.

The Skipton Group Home Affordability Index, created in partnership with Oxford Economics, found that nearly four in 10 renters spend 45% or more of their income on essential housing costs, compounding their inability to save for a deposit.

First step

For first-time buyer households earning £22,850 a year or less, fewer than 1 in 100 can afford to take the first step onto the property ladder in their local area, while even among those earning over £71,250, only 44% can afford to make the move.

First-time buyers face the best prospects in Scotland – driven by lower house prices – and the East of England, due to above-average income to house price ratios.

Skipton reports that despite improving during the pandemic, overall housing affordability has fallen over the course of the cost-of-living crisis and sits almost exactly where it was at the beginning of 2020, with limited signs of improvement on the horizon.

stuart haire skipton connells
Stuart Haire

CEO Stuart Haire says it’s a bleak picture and believes urgent action is needed. He adds: “We are calling on the government to work cross department, cross Whitehall, cross sector and cross industry, so that together we can really start to solve an issue that impacts so many people. We stand ready to be part of those efforts.”

Last year Skipton launched a deposit-free mortgage for first time buyers.


What's your opinion?

Back to top button