London first-time buyers: Waltham Forest sees the highest price rise in the capital since 2012

29 March 2017

  • The average first-time buyer mortgage in London has increased by 71% since 2012 to £317,253 in 2017
  • The average monthly first-time buyer mortgage payment varies from £1,055 in Barking & Dagenham to £2,017 in Westminster
  • The average first-time buyer deposit in the capital has risen by over £30,000 to £87,853 in 2017

Over the past five years, first-time buyer house prices in London boroughs have risen most rapidly in Waltham Forest, increasing by 93% from an average of £212,629 in 2012 to £409,491 in 2017, according to new research by Lloyds Bank. The boroughs recording the next biggest gains are Newham (92% to £359,212) and Greenwich (91% increase to £382,945). All three adjoining boroughs had average prices well below the London average five years ago.

 Westminster has seen the smallest rise in prices since 2012 with an increase of 28% to £595,568; less than half the gain across London as a whole (67%) and significantly below the UK average of 50%. Westminster was the most expensive borough for first-time buyers in 2012 with an average price of £466,4821; 92% above the London average of £242,931.

Hammersmith & Fulham (36%), Richmond-upon-Thames (47%), Camden (47%) and Islington (49%) were the only other boroughs to experience an average first-time buyer house price rise of less than 50% between 2012 and 2017.

Despite its relatively small price gain over the past five years, Camden has become the most expensive borough for first-time buyers, with an average house price of £602,080. At the other end of the scale, Barking & Dagenham has remained the least expensive borough for first-time buyers despite a 74% rise in average prices since 2012. The borough is the only one where the average price paid by first-time buyers is below £300,000 (at £292,446). Havering (£317,168) and Bexley (£324,910) are the next least expensive boroughs for first-time buyers.

Andrew Mason, Lloyds Bank Mortgage Director commented: “Over the past five years, the price of a first-time buyer purchase in London has risen by an average 67%, with some parts of the capital recording even more substantial rises.

“This means monthly mortgage payments and deposits have increased substantially, making it increasingly difficult for many young people to buy their own home, and as a result we saw a 5% drop in first time purchases last year2.”

Mortgage Size and Monthly Payments

The average mortgage taken out by a first-time buyer in London has increased by 71%, from £185,538 in 2012 to £317,253 in 2017. The average mortgage in the capital is nearly double that for a new first-time buyer in the UK as a whole (£168,296). The average age for a first-time buyer in London is 32 compared to the UK average of 31.  Full time average earnings are £44,549 in London compared to £34,769 in the UK.

The average first-time buyer mortgage ranges from £461,632 in Westminster to £241,520 in Barking & Dagenham. The average mortgage in Barking & Dagenham has risen by over £100,000 over five years despite the borough remaining at the bottom of the table in terms of mortgage size. The average mortgage in Westminster increased by £104,763 between 2012 and 2017.

In monthly terms, the average mortgage payment paid by a new first-time buyer varies by almost £1,000 from £2,017 in Westminster to £1,055 in Barking & Dagenham. The average monthly mortgage payment across London has risen by £447 from £939 in 2012 to £1,386 in 2017. This is more than double the UK average increase of £181 from £555 to £735 between 2012 and 2017.

Deposits

The average deposit put down by a first-time buyer is highest in Hammersmith & Fulham, at £190,518. The average deposit is also above £150,000 in Camden (£150,331). In contrast, average deposits are below £55,000 in Barking & Dagenham (£50,926), Havering (£52,745) and Bexley (£53,753).

The average deposit in the capital has risen by over £30,000 over five years from £57,393 in 2012 to £87,853 in 2017. The average deposit in London is more than double that put down by a first-time buyer across the UK (£37,570).

Age

The oldest first-time buyers are in Richmond & Thames (35), followed by Harrow and Ealing both with an average age of 34. The average age of a first-time buyer is four years younger, at 31, in five boroughs: Lewisham, Tower Hamlets, Southwark, Islington and Lambeth.