First time buyers 'paying five times their income'

The average home in London now costs five times the average income of a first time buyer, according to a new Hometrack report.

A quarter of all young working households can now not afford even the cheapest property in their area, the study found – a proportion which rises to over 50 per cent in some towns in the south-west and Buckinghamshire.

As a result, the number of movers shifting into the private rental sector has almost doubled in the past eight years, the study found – in part down to the nature of the UK housing stock, Hometrack suggested.

"The affordability problems highlighted in this research are largely a result of an unbalanced and inflexible supply of homes which has led to high entry costs for housing," commented Hometrack director of research Richard Donnell.

"While the government has recently set out new targets for house building this research highlights the importance of developing the right type of housing in the right forms of tenure," Mr Donnell added.

The government recently announced it was to double the number of eco-towns planned for the UK – a key part of its new home targets – from five to ten.


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