Over the past 12 months, figures show that house prices in London have risen by 7.8 per cent, and that the demand for houses has far outstripped the supply to the first time buyer market.
The market has seen a large increase in price over the last year, according to Rightmove data, which says that the average house price in Greater London is currently £615,115.
This is, in the vast amount of cases, out of the price range of someone seeking out their first mortgage, limiting choice for younger people trying to get onto the property ladder.
Between June and July this year, this issue was emphasised by a price jump of 1.1 per cent for homes which would be typical purchases for first time buyers.
Conversely, although prices at the expensive end of the market have been reported to climb by 9.7 per cent overall across the last year, they dropped by 7.2 per cent between June and July.
“Stretched affordability is acute in nearly all market sectors in London,” said the director of Rightmove, Miles Shipside, “but the lower-end sector with up to two bedrooms has high demand from first time buyers, down-sizers and investors.”
Jeremy Duncombe, director at the Legal and General Mortgage Club, said: “Lending picked up in June, signalling an end to election jitters that caused some prospective buyers and sellers to postpone entering the market.”
Property enquiries for homes with just one or two bedrooms are also reportedly 24 per cent higher than other sized home, showing that interest is indeed high for those smaller, first time homes.