The study showed that FTBs in the South borrowed an average of £128,370 – 31 per cent more than the North’s £89,189. By comparison, the divide in 1997 was just 8 per cent, with Southerners borrowing £32,927 to Northerners’ £30,522 to get on the first rung of the property ladder.
While the gap between London and the North has always been wide, it has stretched significantly in the past 10 years. In 1997, for a house in London, a FTB would borrow around 30 per cent more than for a house in Manchester or Liverpool. Now the average Londoner will borrow almost twice as much as someone in the North West.
Despite this, FTB numbers have more than doubled in the South over the past five years, while decreasing in the North.
Nici Audhlam-Gardiner, head of mortgages at Abbey, commented: “Even though the housing price difference between the North and South is now more of a gulf than a gap, it has done little to upset the demand for first homes in the South. Perhaps it shows that people in the South want to buy now, expecting prices to continue rising, whereas buyers in the North feel they have less to gain by jumping on the ladder.”
James Cotton, mortgage specialist for London & Country, said: “London has an enormous affect on statistics. I’m sure there are parts of the North that compare with parts of the South. If you want to live in the South, you just have to accept the house prices around you.”
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