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Top 10 cities for first time buyers

Top 10 cities for first time buyers
Image source: Getty Images


While buying your first house can be one of the most exciting experiences of your life, it is also a whole new and unfamiliar world. There’s a lot to find out and the learning curve can be steep. 

Like any other first-time buyer, you would probably like to buy a house in a place you’d love to live, that you can afford and where other costs, such as transport and monthly utility bills, are low. Sadly, these factors rarely align. For example, you might find an affordable house in a city where the transport costs and monthly utility bills are simply too high.

However, if you know the places that offer the best combinations of these different factors, the process of buying a house becomes easier and you have a better chance of getting the most for your hard-earned cash.

To help first-time buyers who are on the search for property, digital broker Mojo Mortgages has created a first-time buyer affordability index that takes into account elements like mortgage repayments as a percentage of income, price per square metre of property, average monthly utility bills, average monthly net salary and transport costs.

In this article, we take a look at the top 10 cities in the UK for first-time buyers according to Mojo’s affordability index to help you figure out which one could be best for you.

Rankings for the best cities for first-time buyers

City

Overall rank

Mortgage as a % of income

Price per sq. metre

Monthly bills

Average monthly net salary

Transport costs

Newcastle

1

1

1

8

8

7

Aberdeen

2

2

5

4

1

10

Belfast

3

3

4

1

7

6

Stoke

4

4

3

10

9

9

Hull

5

5

2

2

10

1

Coventry

6

6

7

6

2

2

Southampton

7

7

6

5

3

4

Bournemouth

8

8

9

7

5

3

Cardiff

9

9

10

9

6

5

Leeds

10

10

8

3

4

8

 

The North is king

Mojo’s rankings show that there are a lot of factors to tempt first-time buyers to make the move up North. In fact, the data reveals that some of the best cities for first-time buyers, particularly those looking for lower property prices and bills, are either in the north of England or in Scotland.

At the top of the rankings is Newcastle, where the price of property per square metre is lowest at £1,650, and the average mortgage repayment is 29.05% of a buyer’s income. This means that monthly mortgage repayments in the city are among the most affordable in the country. Additionally, first-time buyers in Newcastle can expect a relatively low annual mortgage interest rate of 3%.

Closely following Newcastle are Aberdeen in Scotland and Belfast in Northern Ireland. Low mortgage repayments of 29.57% of a buyer’s income, a relatively high average monthly salary of £2,275 and comparatively low monthly bills of £130.82 all make Aberdeen quite an attractive place for people looking to purchase their first home.

When it comes to Belfast, the average first-time buyer can expect to pay the lowest monthly bills of all cities in the top ten at £76.38, and they can also expect relatively low mortgage repayments of 31.67% of their income.

What about the South?

If the cooler temperatures of the North are a deal breaker, then there is good news for you as a few cities in the South also make the list of the best cities for first-time buyers.

These cities include Southampton, where first-time buyers can expect mortgage repayments of 39.41% of their income, transport costs of £52.68 and a price of £2,333.33 per square metre of property.

Another attractive southern city for first-time buyers is Bournemouth, where mortgage repayments are 42.76% of a buyer’s income (at a relatively low yearly mortgage interest rate of 3.15%) and transport costs are just £52 per month.

Therefore, for first-time buyers looking for a balance between decent weather, attractive salaries and relatively affordable mortgage repayment rates, Bournemouth and Southampton are among the top places to go.

You might want to note, however, that the price of property per square metre is relatively high in both cities. Prices of £2,700 in Bournemouth and £2,333.33 in Southampton are more expensive than those in cities in the North, where prices typically range between £1,650 and £2,250, meaning you may get less property of your money.

Full data for the top cities for first-time buyers

City

Mortgage as a % of income

Price per sq. metre

Monthly Bills

Average Monthly Net Salary

Transport Costs

Newcastle

29.05%

£1,650.00

£145.82

£1,631.57

£57.20

Aberdeen

29.57%

£2,250.00

£130.82

£2,275.00

£65.22

Belfast

31.67%

£1,900.00

£76.38

£1,636.86

£55.50

Stoke

34.64%

£1,850.00

£172.78

£1,536.11

£65.00

Hull

35.34%

£1,666.67

£122.20

£1,415.28

£45.81

Coventry

38.06%

£2,466.67

£142.31

£2,096.00

£50.00

Southampton

39.41%

£2,333.33

£141.63

£2,006.67

£52.68

Bournemouth

42.76%

£2,700.00

£143.55

£1,932.67

£52.00

Cardiff

43.80%

£2,750.00

£166.05

£1,866.67

£53.18

Leeds

44.21%

£2,666.67

£123.19

£1,937.02

£60.00

Source: All data sourced from Mojo Mortgages.

Data collated February 2020. Average prices, rates and percentages are subject to change.

Which cities should first-time buyers avoid?

Unsurprisingly, London is the toughest place for first-time buyers to get onto the property ladder. The city has always been notorious for its high property prices, and this continues to be the case in 2020.

In London, a monthly mortgage repayment as a percentage of income is a staggering 145%. This means that you would need to earn 45% more than the city’s average monthly net salary to even think about buying a property. Also, the price of property per square metre stands at a whopping £13,068, and the monthly cost of transport is among the highest in the country, coming in at £143.48. 

Other cities that first-time buyers are likely to find very expensive include Derby, Northampton, Brighton and Liverpool.

Liverpool, Brighton and Northampton all have a relatively high mortgage as a percentage of income rate and price per square metre. On top of this, the average net salary in these cities is quite low, meaning that unless you have savings behind you, affording a property as a first-time buyer there might be tricky.

There is more to consider

While factors such as house prices, mortgage repayments, transport costs and average monthly net salary are all important considerations when scouting for a house as a first time buyer, they are just part of a much larger puzzle.

You might be able to score a great house in one of these top-ranked cities, but have you considered the lifestyle sacrifices that you might have to make for the privilege?

For example, will winter temperatures being a few degrees cooler in the North be more than you can bear? Or would you be comfortable to move away from family to an unfamiliar city just because property is more affordable there?

In a nutshell, when investing in a house as a first-time buyer, as much as the price of the property and the cost of living are key, they should be considered alongside other more personal factors that are equally important, including distance from family, career prospects, climate and the availability of social amenities.

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