First-time buyers 'can't keep up' with rocketing city house prices

New figures for the house price index have been released which shows prices are still on the rise in the East of England.

New figures for the house price index have been released which shows prices are still on the rise in the East of England. Inset: Steve Pymm, managing director of city estate agents Pymm & Co - Credit: Submitted

First-time buyers are finding themselves stuck on the bottom rung of the property ladder, muscled out of the market by costs and potential hiccups to the supply of new homes.

According to new data released by HM Land Registry, the average UK house is now valued at £276,755.

The house price index, which was published on April 13, reveals this means prices in the UK have increased by 10.9pc in the past 12 months alone.

Wil Barber, managing director of William's Way Estate Agents, says people who want to buy a home simply can't keep up with the increases.

Wil Barber, managing director and owner of William's Way Estate Agents.

Wil Barber, managing director and owner of William's Way Estate Agents. - Credit: Wil Barber

He said: "This is really a big problem for first-time buyers.

"House prices are increasing at such a rate that people's salaries just can't keep up.

"A lot of people held off buying during the pandemic - understandably so - because of the uncertainty in either their job security or the wider global market.

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"But during the pandemic if you had a £25,000 deposit for a £250,000 house - that same property post-pandemic is now closer to £275,000 - so the deposit also jumps up.

"If people are renting it's so hard to try and save up even more."

The East of England - along with the South West - also saw the highest leap in prices with a 12.5pc hike since February 2021, according to the figures from HM Land Registry.

Steve Pymm, managing director of Pymm & Co Estate Agents.

Steve Pymm, managing director of Pymm & Co Estate Agents. - Credit: Steve Pymm

Steve Pymm, managing director of city estate agents Pymm & Co, believes first-time buyers are also being edged out by people from outside the area moving in.

He said: "Since lockdown there's been more people moving to Norwich.

"People in London, Cambridge and Hertfordshire for example, who can now work from home are able to get themselves a bigger house here. Why get a two-bedroom terrace in London when you can get a four-bedroom in Norwich?

"I feel like first-time buyers who waited during lockdown have now lost out.

"Price increases have been partially generated by people moving from outside of the area and unfortunately it doesn't look like prices are going to come back down - there is still a lot of demand."

Data deep dive: What do the figures tell us?

The data from the HM Land Registry shows that in England the average house price rose 0.9pc in just a month. 

This is in the time period of January 2022 to February 2022.

On a more granular level, the East of England also saw huge increases. 

This is because - according to experts - areas like Norwich are increasing in popularity, leading to the figure of a 12.5pc increase in 12 months. 

A month-on-month comparison shows that prices have increased by 1.3pc between January 2022 to February 2022.

This means the average cost of a home in the region now sits at £345,652.

And those looking to buy a new build may be further stung with the average price now sitting at £377,190.

Although this price saw a 0.6pc dip between January and February, these homes are still 19.6pc more expensive compared to last year.

This is compared to existing resold properties which sit at 1.2pc more than January 2022 and 8.5pc more over the year.