Even buying a portion of a property using a shared ownership scheme is unaffordable for the vast majority of young people in Greater London, Which? research has concluded.
Under 30s in London wouldn’t meet affordability tests for three quarters (76%) of properties within a 20 mile radius of Central London – as they would need to earn £37,300 to afford repayments but they typically earn £27,900.
The average income of first-time shared ownership buyers in 2015-16 was £45,000 in London.
Shared ownership involves buying between 25% and 75% of a property and paying rent on the remainder, which is owned by the local housing association.
David Blake, principal mortgage adviser at Which? Mortgage Advisers, said: “This research demonstrates the impact of rising house and rental costs in the capital.
“Buyers need to be realistic about what they can borrow, and I would suggest that they look at numerous properties as rents can vary considerably.
“That said, it’s not all doom and gloom as the mortgage market is very buoyant right now and lenders certainly have an appetite to lend to first-time buyers.”
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