Top affordable towns for first-time buyers revealed, Inverclyde leads the list

Scotland’s Inverclyde Named Most Affordable for First-Time Buyers

A Scottish town has been identified as the most affordable place to purchase a starter home, according to Nationwide. The building society has released a list of the most and least affordable areas for first-time buyers across the country, highlighting that affordability has improved in 70 per cent of local authorities over the past year.

The analysis involved comparing house prices for first-time buyers in all local authorities in England, Wales, and Scotland against average annual earnings. This approach helps determine the affordability of homes in different regions.

Affordability for first-time buyers has seen some improvement due to a range of mortgage products aimed at helping young people get onto the property ladder. However, some exclusive areas remain out of reach, with homes costing nearly 14 times the average salary.

Affordable Areas for Starter Homes

Northern and Scottish hotspots are among the most affordable areas for first-time buyers. Inverclyde, known for its beautiful scenery and a 45-minute commute to Glasgow, tops the list. Buyers can secure a home for just 2.9 times their annual income, with average sold prices around £100,000 for starter properties. A ten per cent deposit is approximately £9,700.

In the North West, Burnley is the most affordable area with a house price to earnings ratio of 2.8. In the North of England, Hartlepool follows with a ratio of 2.9, while in the West Midlands, Stoke-on-Trent remains the most affordable with a ratio of 3.4.

Andrew Harevy, senior economist at Nationwide, adds: ‘Kingston upon Hull is the most affordable local authority in Yorkshire and The Humber, with a ratio of 3.0. South of the river, West Lindsey in Lincolnshire is the most affordable part of the East Midlands. Further down the east coast, Great Yarmouth in Norfolk continues to have the lowest ratio in East Anglia and is also the lowest priced area in the region. Meanwhile, on the south coast, Gosport in Hampshire is the most affordable area in the outer south east, with notably lower average prices than elsewhere at around £200,000. Swindon remains the most affordable town in the South West, with a house price earnings ratio of 4.8. Meanwhile in the Outer Metropolitan region, Surrey Heath, which includes Camberley and Bagshot, is the most affordable area, due to relatively high earnings.’

Best First-Time Buyer Spots Across the Country

Across London, Bromley – a town in the South East of the capital – is the most affordable local authority to buy a home. However, properties still cost 6.2 times the average annual earnings in the area, pushing it out of reach for most buyers, especially those hunting for a starter home.

Tom Bill, of estate agent Knight Frank, explains that buyers have been forced to find value in other areas of the country as property price tags in London and the South east leave buyers ever more squeezed. He adds: ‘Affordability continues to shape the map of house price growth, with regional parts of the country having slowly narrowed the gap with London over the last decade. With buyers increasingly squeezed by prices in the capital, they have found more value in other parts of the country, which has been made easier by blue chip companies setting up regional operations.’

Glamorous Kensington Least Affordable

Exclusive Kensington and Chelsea tops the list as the most unaffordable spot, with the average home here being some 13.9 times the average annual earning. The area is home to some of the most expensive properties in the country. The price of living in one of these glamorous homes is sky-high and out of reach for nearly all first-time buyers, with a 10 per cent deposit averaging some £100,600, Nationwide reveals.

Outside of the capital, Oxford is the most expensive as properties cost eight times the annual income. In East Anglia, Cambridge has a house price to earnings ratio of 7.3, in the Outer Metropolitan area, Spelthorne has a ratio of 7, and in the south west, South Hams has a ratio of 6.9.

Mr Harvey says: ‘Spelthorne in Surrey is the least affordable local authority in the Outer Metropolitan region. Close to London, this is prime commuter territory and includes towns such as Staines-upon-Thames, Sunbury-on-Thames and Shepperton. In the South West, South Hams in Devon is a popular tourist location, taking in places such as Totnes, Dartmouth and Salcombe. However, with average prices nearly seven times average earnings, it is very challenging for local prospective first-time buyers. Meanwhile, in the East Midlands, Derbyshire Dales is one of the highest priced areas, with much of it sitting within the Peak District National Park, including towns such as Matlock, Ashbourne and Bakewell.’

Worst First-Time Buyer Spots Across the Country

He continues: ‘Another sought after area is Stratford-on-Avon in Warwickshire, which is the highest price location in the West Midlands, with average first-time buyer house prices around £300,000.’ In the North, the least affordable region is Westmorland and Furness as it encompasses swathes of the Lake District. Homes here are priced at 4.1 times the average earnings.

In Scotland, Edinburgh is no longer the least affordable as homes in Midlothian now cost 4.9 times income.

Mary-Lou Press, of estate agency group Propertymark, says: ‘This is a mixed picture for first-time buyers across the country. Significant regional disparities remain. While some parts of the country are becoming more accessible to buyers, high house prices in areas such as London and the south east continue to create substantial barriers, particularly when it comes to saving for a deposit.’