For immediate release
Revealed: The UK cities where locals can buy a property in the shortest (and longest!) amount of time
- The wait for first-time buyers to save up is 12 years for the average city dweller
- Those in Sunderland have the UK’s shortest wait, having to save for under seven years
- Predictably, Londoners have to wait the longest out of anyone (24 years and 11 months!)
29 January, 2020, LONDON –
The UK city where first-time buyers can purchase a property in the shortest period of time has been revealed to be Sunderland. There, locals can save up for a down payment in under 7 years (6 years and 8 months) – 10 months sooner than anywhere else and 18 years quicker than in the capital.
This is due to Sunderland residents earning more than those in 10 other cities in the study, while also enjoying the lowest average property price of £127,500, according to personal finance comparison site, finder.com.
London is the city where it takes the longest to get on the property ladder, with locals having to save for almost 25 years (24 years and 11 months), just to afford a down payment. Despite earning 28% more than the average salary in the study, Londoners face property prices that are almost 3 times the average for UK cities (£749,500 vs £254,900).
The new research from finder.com compared the average salary in the UK’s 35 largest cities with the local house prices to work out how many years it would take a first-time buyer to afford a typical down payment (assuming they save 15% of their disposable income each month and don’t receive any financial help).
Across the UK, city dwellers can expect a wait of 12 years to get on the housing ladder. A down payment amount is most commonly set at 16% of the property’s value, which means an individual would need to save £40,800 in order to purchase a house worth the UK city average of £254,900.
The easiest cities to get on the housing ladder
After Sunderland, Bradford locals are able to purchase a property in the shortest amount of time – seven and a half years. While the city’s average wage is the second lowest of the 35 cities, the second lowest average property price of £137,800 gives locals an opportunity to get on the ladder quicker than in other cities.
Belfast and Hull are the cities with the third quickest timelines for first-time buyers. Despite those in Belfast earning an extra £2,500 per year than those in Hull, higher house prices in the Northern Irish capital mean people in both cities will need to save for 7 years and 10 months to get on the property ladder.
And the hardest…
Londoners face a significantly longer wait to buy their first property than buyers in other cities, but it still takes residents in second-placed Brighton almost 19 years to buy for the first time (18 years and 11 months). This is caused by a mismatch of the city having the UK’s fourth highest average property prices, but an average annual wage (£25,792) that is in the bottom third of the 35 cities studied.
Residents of Oxford don’t have it much better – it takes them just 3 months less to buy a house (18 years and 8 months). This is primarily because the city has the second highest average property price of £460,793 in the UK.
You can use Finder’s comprehensive table to check if your city enjoys a favourable mix of average wages vs property prices at: https://www.finder.com/uk/mortgage-leaderboard
Commenting on the findings, Jon Ostler, CEO at finder.com said: “This research hits home the point that having a relatively high wage or living in a city with low house prices doesn’t guarantee a short wait to get on the property ladder. If you are planning to move to a new city, or are open to the idea, then it is certainly worth looking at how long your saving period would be in a few different areas.
Jon’s tips on how to reduce the time you need to save for
Keep searching for the best interest rates:
“Something that makes a huge difference is ensuring you keep monitoring the market to get the best rate you can on your savings account. Even seemingly small increases in a savings rate can really reduce the time you spend saving due to the effects of compound interest. As an example, our study used a standard market rate of 1.18%, but if you saved your money in an account with no interest, it could take up to 4 years longer to save for a downpayment in some of the cities in our study.
Get a Lifetime ISA:
“If you’re looking to buy a house, a Lifetime ISA can be a really big help. You can put up to £4,000 in it per year and the government will give you an extra 25% (up to £1,000) on top. An effective risk-free interest rate of 25% cannot be matched anywhere else, although you need to be a first-time buyer and use this on a property worth up to £250,000 (or £450,000 in London).
Consider a stocks and shares ISA:
“If you are saving over a long period of time you could also consider a stocks and shares ISA. Although remember your capital is at risk as your investment can go down as well as up, so you may want to move your investments to a savings account sometime before you plan to buy. Investing in the FTSE 100 index between 2010 and 2019 resulted in annual returns of 7.4% – significantly higher than the savings rates of 1.5–2% that were available.”
Finder.com took the average income in each of the UK’s 35 largest cities as stated by Centre For Cities.
Tax, National Insurance and automatic pension contributions were then subtracted from each to leave the net income available.
15% of the net income was taken to give the amount saved each month, and an annual AER of 1.18% was added.
The information in this release is accurate as of the date published, but rates, fees and other product features may have changed. Please see updated product information on finder.com's review pages for the current correct values.
finder.com is a personal finance website, which helps consumers compare products online so they can make better informed decisions. Consumers can visit the website to compare utilities, mortgages, credit cards, insurance products, shopping voucher codes, and so much more before choosing the option that best suits their needs.
Best of all, finder.com is completely free to use. We’re not a bank or insurer, nor are we owned by one, and we are not a product issuer or a credit provider. We’re not affiliated with any one institution or outlet, so it’s genuine advice from a team of experts who care about helping you find better.
finder.com launched in the UK in February 2017 and is privately owned and self-funded by two Australian entrepreneurs – Fred Schebesta and Frank Restuccia – who successfully grew finder.com.au to be Australia's most visited personal finance website (Source: Experian Hitwise).