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Buying a home has become slightly easier for Britons in the past year, but there are huge variations across the country, new research has revealed.

Affordability improved due to a combination of a rise in wages and the tax-free personal allowance, along with the lower cost of essentials. Mortgage rates remaining competitive and lower house price growth have also helped.

Britons' ability to buy a home in England and Wales was 2 per cent better in the three months from July to September compared to a year earlier, according to the Hamptons International buy-to-let index.

Reason to smile: Buying a home has become slightly easier for Britons in the past year.

The index, which is calculated using official data on house prices, incomes, interest rates, as well as taking into account changes in the cost of living, revealed how some regions have it easier than others.

Buyers in the North East and Wales are finding it easier to purchase a home while those in the South East are finding it more difficult.

After covering the costs of essentials, taxes and a mortgage, a typical household in Briton is £69 better off every month, giving them more cash to put towards buying a home, according to the figures.

Households in the North East have £175 more income left at the end of each month, while those in Wales have £123. In contrast, those living in London have overspent by an average of £10 a month.

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Those in the North East saw the largest improvement in their ability to buy due to a 5 per cent increase in wages and a 0.2 per cent fall in house price growth.

But the ability to buy deteriorated for those in the South East, where the growth in house prices continues to outpace the growth in wages.

While house price growth slowed to 8 per cent in the three months from July to September last year from 10 per cent during the same period a year earlier, wages only increased 3 per cent.

CASH LEFT AFTER TAX, ESSENTIALS AND MORTGAGE PAYMENTS

	UK	NE	NW	Y&H	E Mids	W Mids	East	London	SE	SW	Wales
FTB	£50	£105	£45	£57	£16	£67	£70	£20	-£3	£53	£79
Two full time earners	£79	£203	£68	£99	-£12	£122	£153	£15	-£18	£81	£144
Full time with children	£81	£206	£71	£101	-£9	£124	£156	£18	-£15	£84	£147
Full time & part time with children	£68	£186	£68	£92	£19	£100	£110	£4	-£3	£69	£121
Average	£69	£175	£63	£87	£3	£103	£122	£14	-£10	£72	£123
Source: Hamptons International

Life has got better for some first-time buyers,  according to the Hamptons report

Fionnuala Earley, director of residential research at Hamptons International, said: 'With inflation remaining low and wages increasing in real terms, most households are seeing their money stretch a bit further.

'The added bonus of the higher tax free personal allowance announced at the last Budget, means households get to keep more of their income, improving their ability to buy. On top of this, global economic uncertainties mean that interest rate rises look even further away, giving buyers a little more leeway too.

'While it's encouraging that ability to buy is getting better year-on-year, with prices 5.5 times higher than incomes, it's still very expensive to buy a home, and out of reach for many first-time buyers.

'The key to better affordability is for wages to increase substantially faster than house prices.'

 

 

PERCENTAGE CHANGE IN DISPOSABLE INCOME AFTER TAX, ESSENTIALS AND MORTGAGE PAYMENTS

	UK	NE	NW	Y&H	E Mids	W Mids	East	London	SE	SW	Wales
FTB	10%	17%	7%	10%	3%	14%	14%	9%	-1%	17%	16%
Two full-time earners	3%	8%	3%	4%	0%	5%	6%	1%	-1%	4%	6%
Full-time with children	3%	9%	3%	4%	0%	6%	6%	1%	-1%	4%	7%
Full-time & part-time with children	5%	12%	4%	6%	1%	7%	8%	0%	0%	6%	9%
Source: Hamptons International

 

ABILITY TO BUY INDEX (1997 = 100): IS IT EASIER OR HARDER TO BUY IN REGIONS OF THE UK SINCE 1997?

	UK	NE	NW	Y&H	E Mids	W Mids	East	London	SE	SW	Wales
Q3 2013	101	107	106.1	105.7	104.2	105.8	100.1	74	97.1	94.4	107.8
Q4 2013	101.2	108.5	106.3	106.1	103.8	106	100.1	71.5	97.8	94.4	107.8
Q1 2014	100.5	107	106.5	106.1	104.1	105.2	99.7	66.7	97	95.2	108.5
Q2 2014	99.5	106.8	106.1	105.1	103.5	104.5	98.7	60.5	95.8	94.1	108.3
Q3 2014	98	107.9	105.3	104.8	102.7	104.5	97.6	52.8	93.3	93.1	106.8
Q4 2014	99.2	109.3	106.6	105.8	103.9	105.3	98.7	56.3	93.1	95.3	108
Q1 2015	100.4	110.9	107.4	106.9	104	107.4	99.6	59.1	94.1	95.8	108.4
Q2 2015	101	111.6	107.6	107.3	104.6	108	99.7	57.8	93.8	96.4	109.4
Q3 2015	100	111.8	107.2	107.2	103.4	107.4	99.6	52.9	92.4	96	110.6
Source: Hamptons International (1997 is where index began and all movements in the index relative back to that point. Values below 100 indicate it is harder to buy than in 1997

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