Homes to cost £1 million in London in 10 years

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by Kay Murchie

According to building society Stroud & Swindon, in a decade’s time first-time buyers in London will need approximately £1 million to buy a home.

The research was based on house price growth for first-time buyers between 1997 and 2007 and using the same rate of growth for the next 10 years, it predicts that a first-time buyer in London could end up paying £1 million for a home in 2017. It forecasts that the rest of the UK will face a similar situation by 2024.

It is hoped that these forecasts won’t come true but in the last 10 years, salaries have only increased by 35% but the average house price in England has escalated by a huge 135%, so these calculations are not completely unrealistic.

The National Housing Federation (NHF) predicts that the average UK house will have increased by 40% by 2012, to £302,400 - still a scary outlook for first-time buyers.

A spokesperson for the NHF commented that their projections show that buying a house in this country isn’t going to get any easier. An increasing amount of people will discover that the only way of getting onto the property ladder is via a housing association.

NHF concluded that unless something drastic is done about the shortage of housing, overcrowding will set in the family home.