House prices across North West jump by a third in five years as first-time buyer costs rise £400

A set of house keys
-Credit: (Image: PA Archive/PA Images)

New analysis suggests that first-time homebuyers are now paying around £400 more per month for their mortgage than they would have five years ago.

According to property website Rightmove, the average first-time buyer's mortgage payment has increased by 61 per cent since the last general election in 2019, from £667 to £1,075 per month.

Across the North West, asking prices for first-time buyer homes have increased by a third since 2019, while London has seen the smallest percentage rise of just 6 per cent over the past five years, as per the website's data. Across Britain, first-time buyers now face paying an average of £227,757 for a home, a figure which has risen by nearly a fifth (19%) since 2019.

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The calculations were based on several assumptions, including that first-time buyers would have a 20 per cent deposit, a 25-year mortgage term, and a five-year fixed-rate mortgage at an average rate. Rightmove used the average asking prices of typical first-time buyer homes, with two bedrooms or fewer for their research.

Officials from Coventry City Council visited the address in Longford
House prices and mortgage costs have increase by double digits in the last five years -Credit:Rui Vieira/PA Wire

Rising mortgage rates and house prices have affected monthly mortgage payments. Despite the Bank of England's base rate remaining unchanged last week, a drop is anticipated due to the Consumer Prices Index (CPI) inflation reaching its 2 per cent target.

Tim Bannister, property expert at Rightmove, said: "As rates have increased over the last five years, the amount that a typical first-time buyer is paying each month on a mortgage has outstripped the pace of earning growth. Some first-time buyers are looking at extending their mortgage terms to 30 or 35 years to lower monthly payments, or looking at cheaper homes for sale so that they need to borrow less.

"If mortgage rates reduce, this will help first-time buyers in the short-term more so than election housing promises. We hope that the next government can support first-time buyers with well thought out policies, which address the difficulties of saving up a large enough deposit and being able to borrow enough from a lender."

What do voters want from the next government?

These results were disclosed as another property website, Zoopla, discovered that people rank building more affordable houses, addressing homelessness and reducing empty homes as the top housing priorities for the next government.

Research by Ipsos for Zoopla also determined that aiding first-time buyers onto the property ladder and controlling rent hikes in the private sector filled out the top five concerns.

Richard Donnell, Zoopla's executive director, commented: "British voters have high expectations from a new government on housing. The overarching response is: 'Build more homes, but other things matter too'.

"People's experiences and priorities vary based on their position in the market. Renters want more focus on their priorities including raising housing benefit levels and managing the pace of rental growth, while also improving rights and protections.

"Rent reforms are on the agenda for all parties but managing rental inflation is best achieved by growing supply through new home building as measures to control rents can reduce new investment.

"It is clear voters are well aware of the pressures on the housing market with reducing homelessness and rough sleeping and doing more to reduce empty and under-utilised homes in the top three priorities."

Ben Marshall, Ipsos' research director, remarked: "The survey also finds a sense that the governments can affect change."

Nathan Emerson, Propertymark's chief executive, stated: "Surging interest rates and inflation over the last few years have impacted the housing market with force.

"However, with the next General Election now less than two weeks away, Propertymark is keen to see targeted support for first-time buyers at the first opportunity from any incoming government.

"The potential of home ownership should never be a prospect that is ever out of reach for people. As inflation is now back within the range initially targeted, we are optimistic to see the base rate cut as soon as realistically possible, which would be very welcome news for people stepping onto the housing ladder when it does happen."

The average asking price for first-time buyer properties in 2024 compared to 2019, according to Rightmove, is as follows:

  • East Midlands, £192,497, a 24 per cent

  • East of England, £272,539, a 14 per cent

  • London, £507,049, a 6 per cent

  • North East, £131,809, a 22 per cent

  • North West, £177,588, up by 33 per cent

  • Scotland, £139,198, rising by 22 per cent

  • South East, £296,238, a 15 per cent

  • South West, £256,687, up by 24 per cent

  • Wales, £180,458, an increase of 28 per cent

  • West Midlands, £193,957, rising by 24 per cent

  • Yorkshire and the Humber, £178,871, up by 30 per cent