What could a first-time buyer home in London get you elsewhere in the UK?

What could a first-time buyer home in London get you elsewhere in the UK?

Tepilo looks at what the price of a first-time buyer home in London could get you elsewhere in the country, with money going furthest in cities like Newcastle and Liverpool.

What could a first-time buyer home in London get you elsewhere in the UK?

First-time buyer homes in London are often criticised for being too expensive for the demographic they are supposed to be aimed towards.

And now new research has now shown what the price of a London first-time buyer home would get you in the rest of the UK, with first-time buyers in the capital typically shelling out double that of their counterparts across the country.

First-time homes in London soar above the rest

If you’re a first-time buyer looking to purchase in London, you are likely to need a healthy bank balance and a fairly hefty deposit. The average first-time buyer home in the capital currently stands at a record £420,000. On a nationwide basis, by contrast, it stands at a shade over £210,000.

In the last five years the value of an average first home in London has increased by two thirds, according to Lloyds Bank, even in spite of the overall decline in the capital’s house prices in recent times.

A deposit of almost £93,000 is required by the average first-time London buyer, a rise of over 60% from 2013 and more than double the deposit needed by other first-time buyers across the country.

With this in mind, it’s not surprising to learn that the proportion of first-time buyers in London has been dropping for the past three years. Would-be homeowners are choosing to cut their losses and move elsewhere for greater levels of affordability.

Young professionals, in particular, are willing to move away from London to get their foot on the property ladder for the first time, and this goal is being helped by the number of companies who are setting up base away from the capital.

Much of the BBC now operates out of MediaCityUK in Salford, HSBC UK has recently created a new headquarters in Birmingham, Channel 4 has shortlisted cities including Leeds, Liverpool, Manchester, Glasgow and Coventry for its new national headquarters, and Oxford and Cambridge, the grand old university cities, are increasingly becoming a hotbed for tech firms, digital and pharmaceutical startups and research centres for the likes of Apple, Amazon and Microsoft.

The new jobs and homes being created in areas like these, as well as thriving cities such as Bristol, Sheffield, Newcastle and Edinburgh are luring young buyers away from the capital to major regional hubs instead.

People with no links or ties to a particular area are often happy to follow the new jobs or homes, regardless of their location. And, when it becomes clear what a first-time buyer home in London will get you elsewhere in the country, it’s easy to see why many are choosing to leave the capital behind.

A one-bed to a four-bed townhouse

In London £420,000 could get you a one-bedroom first floor flat in Earlsfield, south-west London, with 600 sq ft of floor space, including kitchen, bathroom and living room. Train links are excellent, with Central London reachable in just 30 minutes. For the same price, a smart two-bedroom, two-bathroom loft apartment in a Grade II-listed Victorian mill could be purchased in Ancoats, Manchester. Close to Manchester Piccadilly and overlooking the Rochdale canal, buyers here would find themselves in one of the city’s most happening locations.

In Birmingham, meanwhile, £400,000 goes even further, with a three-bedroom apartment in stylish Edgbaston (best known, of course, for its cricket ground) on the market for less than the average first-time buyer home in London.

In Leeds, a legal and financial hub second only to London, a four-bedroom semi-detached property could be secured for around £415,000. For a home on the outskirts of the city, a 10-minute drive from the centre, buyers would need £5,000 less than the average first home in London.

It’s a similar situation in Glasgow, often cited as one of the UK’s most affordable cities. A three-bedroom flat in the heart of Glasgow, just five minutes from the city’s Charing Cross station, would set buyers back £420,000, while in Southampton a two-bed apartment in swanky Ocean Village could be purchased for around £400,000, £20,000 less than an average first London home. For this you’d get marina views, stylish modern living, double en-suites, a balcony and more than 1,000 sq ft of floor space, plus the added bonus of only being two miles or so from Southampton’s city centre.

Buyers would also get plenty of bang for their buck in James Street, Liverpool, where a contemporary three-bedroom penthouse apartment in the heart of the city would be on the market for £410,000. In Newcastle, you get even better value for money, with a three-storey, four-bedroom townhouse in trendy Jesmond setting buyers back around £410,000. This would get you 1,300 sq ft of floor space, a kitchen/breakfast room and a sizeable floored loft space, all located in a quiet gated community in the heart of Newcastle.

Regional hubs offer greater affordability

It’s nothing we didn’t know already; buyers will generally be better off in places away from London and the South East if they prize affordability above all else. We looked previously at the connection between affordability, jobs and location, and found much the same results.      

That said, London’s property market is the busiest and largest in the country and with careful planning, thorough research and a little bit of being in the right place at the right time, bargains and excellent deals can still be found.

Up-and-coming areas, or areas that most people don’t know about yet, are likely to have the most affordable properties on offer. If you are working on a tight budget, though, heading for the UK’s regional hubs will be your best bet.

If you are a selling a property in any of these regional locations, demand should be high from those eager to get on the ladder for the first time – and, even better, they will be keen to push through sales in a fast manner.

In London, too, the number of first-time buyers might be falling, but demand from this group is still very high and you shouldn’t be short of willing buyers if you are looking to sell your home to this market.

For more on this topic, check out Compare My Move's comprehensive guide on moving to London, which includes a whole section dedicated to first-time buyers.