On average it takes more than 17 years to raise a 10% deposit
The average person saving for their first home in Merton is now further away from a deposit than they were this time last year – in spite of a year of saving, according to new research.
House prices are racing away at such a rate that the money required for a deposit is growing annually by more than can be saved in a year – over two years more in Merton, the highest in outer London and the sixth highest in London overall.
In Merton it would now take over 17 years to save for a deposit, according to figures compiled by the office of Tessa Jowell who is running to be Labour's candidate for Mayor of London.
She said: "London's housing crisis has spun so far out of control it is becoming literally impossible to save for a deposit in Merton.
"We cannot go on like this – solving the housing crisis is the number one challenge facing this city – and will be my top priority if I’m elected Mayor.
"We have to start building the homes we need, that’s why on my first day in City Hall I’d establish Homes for Londoners to get London building again, starting on the Mayor’s own land. And I’ll help first time buyers afford their first home without the need for enormous upfront deposits by building rent-to-buy homes which will turn rental payments into a contribution towards a deposit."
At the current rate of house price inflation, and taking into account average wages, the only boroughs in London where first-time buyers can ever save enough for the average deposit are Newham, Croydon and Havering.
In Merton the average house price is £385,450, and, as the average wage in the borough is £32,073, it takes someone more than 17 years to save a 10% deposit.
August 20, 2015