The study showed the £1 million starter home would hit FTBs first in areas with strong house price growth, reaching Greater London in 11 years, the South East in 15 years and the South West in 16 years. However, this forecast had not changed in the last 12 months as house price inflation stabilised.
The biggest change on last year was seen in Northern Ireland, with predictions that the £1 million FTB home could surface in 2018 – seven years sooner than predictions in 2006 and on a par with London.
Other regions where high house price growth has led to predictions coming forward are Scotland, the North East, Wales and Yorkshire and Humberside.
Paul Chafer, sales director of Stroud & Swindon BS, commented: “Providers need to consider their lending criteria and actively work to develop products that help FTBs to get onto the property ladder in a responsible and sustainable manner. It is pointless simply increasing income multiples if this is going to result in consumers taking on debt they cannot service.”
Rod Murdison, proprietor of Murdison & Browning, commented: “The proportionality is more important than the actual figures. A lump sum is eye catching, but it depends on what happens with inflation, people’s salaries and what the government does to help FTBs. Of more concern is whether salaries increase by the same amount.”
