'Path to home ownership' in Suffolk only getting 'steeper', experts say

Suffolk house prices are continuing to rocket in Babergh in particular

Housing experts say it's getting more difficult for first-time buyers to get on the property ladder as house prices continue to rocket. - Credit: PA

House prices rose by more than one-and-a-half-times the average annual salary in some parts of Suffolk last year, analysis for this newspaper has found. 

The study found that in Babergh the average price of a home bought by a first-time buyer rose by £40,236 last year. This is £13,620 more than the average annual wage in the district of £26,616.

The average first-time buyer home in the district costs £270,760 – 10.2 times the average salary. 

In Mid Suffolk and East Suffolk prices also rose by more than the average annual salary.

Experts say it won't get any easier for first-time buyers to get on the housing ladder.

Max Turner, boss of Savills Suffolk's new homes team, said: “The lifestyle factors that people have been looking for since the outbreak of the pandemic continue to drive the housing market and activity levels remain high.

"However, there have not been enough homes on the market to meet demand, generating fierce competition among buyers and contributing to house price growth.

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“Consequently the path to home ownership for first-time buyers has only become steeper.

"Lenders have tended to favour less risky, lower loan to value lending, making it harder for new buyers to access the market without assistance and – while we expect lending at a higher loan to value ratio to continue to be available –  slowly rising interest rates, increased costs of living, higher national insurance and the prospect of a lower threshold for student loan repayments will make saving for a deposit all the more challenging. 

Max Turner, who leads the new homes team at Savills Ipswich

Max Turner, who leads the new homes team at Savills Suffolk - Credit: Richard Marsham/RMG Photography

“For many first-time buyers, choosing a new build property is a route onto the property ladder. Lots of developments offer financial support and help with paying a deposit.

"Shared Ownership and Help to Buy are two popular examples, but developers will also offer other incentives such as paying the mortgage for the first six months."

Joanne Leek from the Suffolk Building Society said more potential buyers were taking on extra work to try and get a foot on the housing ladder.

She said: "I don't think it's ever been easy for first-time buyers, but it certainly doesn't look like it's going to get any easier.

"House prices have risen a lot and it is really tough.

Joanne Leek from Suffolk Building Society

Joanne Leek from Suffolk Building Society - Credit: Simply C Photography

"There is no magic potion for first-time buyers. It's just looking at what's right for you and your circumstances."

Research from the Ipswich-based lender found that two-thirds of first-time buyers have turned to a 'side hustle', or second source of income, to help save for a deposit.

Around a third of these first-time buyers have started their own business, while others have taken on informal weekend work such as a bar job or shifts in a restaurant.

The building society, which provides mortgages throughout England and Wales, found that for many first-time buyers so-called 'side hustles' accounted for up to 40% of their deposits.

This would equate to £23,000 of the average deposit of £59,000. 

Mrs Leek added: "Some people are lucky enough to have a gifted deposit from a family member. That's pretty rare, but it does happen.

"The other thing is just to be realistic about your expectations.

"It is about a property ladder. You get what you can afford. And you know what you can comfortably afford to start with, and you build up from there."

Last year Dr Dan Poulter, North Ipswich and Central Suffolk MP, said there were numerous government schemes designed to help people onto the housing ladder, but called for "appropriate" development to help keep prices down.

Dr Dan Poulter has previously said "appropriate" development is needed to help stop Suffolk house prices rising

Dr Dan Poulter has previously said "appropriate" development is needed to help stop house prices rising - Credit: SARAH LUCY BROWN

He said: "There's no easy answer to dealing with that increased jump in house prices beyond making sure that we have more housing in appropriate areas."