The UK Archives - Page 3 of 3

As the UK's largest metropolis and economic center, London remains one of the best and expensive cities to own a property in Europe. A look into the current market prices will guide you in buying a house for residential or commercial use. The average cost of buying a house in London is £500,000. There's been a 20% rise in house prices from 2021, making the average cost per square meter range between £8,440 and £11,280. For the past twelve months, the most expensive boroughs have seen an average of £80,000 increase in the buying price. The rapidly growing population in London has inevitably led to a rise in housing demands and costs. Although London is the most expensive place to buy a house within the UK, different neighborhoods in London have different property values. According to a recent study, the most expensive areas have high council tax rates, unlike the cheaper boroughs. Cost of a house in London in 2022 The average cost of buying a house in London is £662,000. This is a £690 increase from a year ago (2021). Whereas the average price of an established property is £664,000, the cost of a newly built house is £623,000. Average prices for house or flat in Central London: 1 bedroom: £785,4372 bedroom: £1,430,7943 bedroom: £2,873,0664 bedroom: £4,370,5435 bedroom: £6,326,405 Location by far plays the most important role in house price in London. Expensive boroughs like Islington and Fulham record an average buying price of £2.1 million while areas like Dagenham and Newham sell at a mean of £300,000. However, there are 51% and 35% purchases and property viewings, respectively. As a result, sellers have dropped their asking prices by about 44%, but there is also a 8% drop in houses available for sale. Will house prices in London go down in 2022? With the city enveloped by Omicron, political instability against oppositions at 10 Downing Street, and the predicted increase in tax rates, the costs of houses will continue to rise in 2022. Aspects that will determine the cost of housing in London in 2022 include: 1. A return of potential home buyers For two years now, property market analysis has been determined by the pandemic. The first lockdown pushed families out of the capital. This led to demand and a rise in prices in areas bordering London as people were forced to work from home. The reopening of institutions and companies ignites a renewed appetite for potential homebuyers who want to live close to their workstations. There will be an influx of investors from overseas. The effects of this return have already been felt. Accepted house offers have reached a 10- year high. There's a 25% and 116% increase in these offers compared to last year in outer London and Central London, respectively. The increased confidence of a decline in the threat of Omicron has increased the number of properties listed. If Omicron dies down, more houses will be built to meet the demand, and that will cause a significant drop in house prices. 2. Interest rates Apart from the continued rise in energy prices and inflation, interest rates have experienced a 0.25% rise, with significant increases expected during the year. Although experts predict that property market rates will remain constant despite the increasing interest rates, potential homeowners are rushing to buy properties before another interest increase is made. 3. Political instability Political unrests have historically affected the housing market, especially the inner London market leading to a growth in house prices. There's the current political heat surrounding Boris and the tension following the leaked revelation of parties at Downing Street. House prices are expected to go high in the near future following this political instability. Experts use past political unrests to study changes in the economic market. How much salary do you need to buy a house in London? It has become nearly impossible to buy a house in London on an average salary. House prices in the capital remain unreachable for average earners. If you think your salary is high enough to buy a house in London, these figures may shock you: With an annual salary of about £17,500, you can own a house in either Redbridge or Newbury Park. You need to be earning about £25,000, £26,000 and £27,000 to purchase a one-bedroom house in Cricket, Chigwell and Wanstead respectively. In Knightsbridge, with a salary of £248,000, you can secure a mortgage.Statistically, nurses who earn an average salary of about £28,000 can only afford to live in about 2% of locations in the city.In order to purchase a house in the leafy suburbs of London, you need to be earning a salary of £84,000 annually as a household. Read about salaries in London. Can you get a mortgage in London? Getting a mortgage for a home in London can seem exhaustive, especially for first-time buyers. It's necessary to review your borrowing threshold so that you can know the houses you can afford and the possible deposit. Banks and mortgage lenders will consider the following factors to determine your eligibility: Age Considering that mortgage payments are made over longer periods of time, older people are less likely to be considered for them. However, some institutions will lend to older age groups who can pay substantial initial deposits and repay the mortgage over shorter periods. Job security A lender will need confidence that a borrower can meet the payments. A mortgage lender will determine how much you can borrow based on your income. Credit score Just like every other lending institution, mortgage lenders will check your credit score. If you have a low credit score, you will not be eligible for mortgages. Depending on your budget, the price of buying a house with a mortgage varies in the different boroughs. While in Kensington and Chelsea, it averages £1.3 million, in Merton and Barnet houses are priced at £500,000. How much deposit do you need for a mortgage in London? In order to buy a home, you will need a considerable mortgage deposit. The deposit requirements in London for a house are 10% of the house's value and 15% for first-time buyers. Currently, lenders are asking for higher deposits following economic uncertainties as a result of the pandemic. With mortgages, a higher deposit is always better. In fact, with a deposit of 15%, your interest rate and monthly repayments will be lower. A 15% deposit on a house valued at £360,000 would be £24,000. However, paying such huge deposits is a nightmare for several people. As a result, the government currently backs the return of 95% mortgages with some select lenders. Which house schemes can you access in London? 1. London Help to Buy Help to Buy London scheme is available only to first-time buyers; London Help to Buy scheme provides an equity loan of 40% of the house's value. In other parts of the UK, this scheme offers 20% of the property's value. For instance, you can make a 10% deposit, take an equity loan of 40% of the property price and take a 50% mortgage. 2. Shared ownership Shared ownership has become popular in London since many people cannot afford to buy a property on their own. This scheme allows you to purchase between 25% and 75% of the property and pay rent of up to 3% on the remaining share. As you continue to increase your share, you can become a full owner of the property. Though Shared Ownership Scheme looks attractive, this scheme is expensive in the long run. 3. London Living Rent Designed to enable middle-class residents to climb up the property ladder, London Living Rent allows you to pay below-market rents. By doing this, these residents can save more money, deposit these savings in an account meant for buying the property. For you to qualify for this scheme: You must rent in London.You must have an annual household income of not less than £60,000.