Problems mount for first-time buyers
FIRST-time buyers in East Anglia are forced to endure a record five years of saving to gather enough money to put down a 5% deposit on a house – the longest wait in the whole country.
FIRST-time buyers in East Anglia are forced to endure a record five years of saving to gather enough money to put down a 5% deposit on a house - the longest wait in the whole country.
The shocking figures were revealed in a National Savings and Investments (NS&I) survey, which showed the average first-time house in the region now costs £159,714.
That has shot up by more than £17,000 in the last year, despite the fact incomes for those looking to get on the housing ladder increased on average by less than £200 over the same period.
The survey also showed the region's first-time buyers are now forced to save for a year longer to secure their deposit than they did in 2004.
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And, over the past 12 months, the 5% deposit needed has also rocketed from £7,116 to £7,985, heaping more misery on those who hope to buy their own property.
Nationally the average wait to save a deposit is four years and nine months, while house prices increased by 16.5% in the last year compared to a salary increase of just 0.5%.
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Dax Harkins , senior savings strategist at NS&I, said: "Despite a recent cooling house market, house prices have continued to outstrip both savings rates and incomes over the last year which means potential first-time buyers need to start saving sooner and harder to get into the market."
Colin Girling, PR officer for the Suffolk branch of the National Association of Estate Agents, agreed that the situation facing first-time buyers in the region is getting tougher.
He added: "A lot of them are still finding it difficult. I think some of them have to move out of the areas where they grew up to find houses.
"I feel very, very sad for people who have grown up in villages who have to move just to find a house. A lot of villages are dying."
But Mr Girling continued: "I think a lot of these youngsters have got their priorities wrong. Saving money to buy a house is well down their list behind going out, buying clothes, buying a car and things like that.
"The Government are trying to bring out these schemes (to help first-time buyers) and I don't think that's the answer. A more prudent youth is the key."
Richard Doe, an independent financial advisor based at East Anglian Properties in Colchester, said the survey's findings came as no surprise.
He added: "I think first time buyers really are struggling to save enough deposit and often they get the least amount of help from lenders who are not particularly sympathetic to their problem as they are fairly regimented in the way they look at it.
"I can see shared ownership happening more and more, but without first time buyers in the market,
you do not have a market.
"The buy-to-let market is flooded at the moment, people are re-mortgaging rather than selling their own places in order to improve them - it is really difficult for people wanting to get their foot on the property ladder."
Dr Wil Gibson, chief executive of rural communities action group Suffolk ACRE, said the issue was an "increasing problem".
He added: "I think people are moving out of communities that they would like to remain in.
"People move out of smaller settlements into larger urban areas to find housing and that potentially has an impact on the skills pool locally."
Dr Gibson added: "It comes back to this question of availability of appropriate local needs housing.
"Our position on this is that we should be looking at assessing in detail individual community needs and have a gradual house building programme which actually meets those needs."
And, while Bob Feltwell, chief executive of the Suffolk Chamber of Commerce, said the issue was not a big problem for businesses at the moment, he voiced fears that it could hit the economy in the long term.
He added: "We are concerned about the cost of housing for employees but it hasn't come up as a major problem yet in the private sector because people can get rented accommodation in the mean time.
"In the long term it's not helpful to the economy. The problem of first time buyers won't go away and it will slow down the take-up of jobs in the future."