Forecast price rises set to increase affordability pressures for aspiring homeowners
First-time buyer homes in England could be more than £40,000 pricier by 2030 if house prices follow the latest Office for Budget Responsibility (OBR) projections, analysis from Coventry Building Society suggests.
The mutual lender has modelled the impact of a 2% rise in house prices this year and a 16.4% increase by the end of the decade on average first-time buyer values.
Based on its calculations, the average first-time buyer property in England would rise by £40,147, moving from £244,799 to £284,946. In London, the effect is even more pronounced, with the typical FTB purchase price projected to increase by £77,162 – from £470,503 to £547,665.
Across the wider market, Coventry Building Society estimates that if all regions tracked the OBR path, the mean UK house price would climb by £44,322, from £270,259 to £314,581 by 2030-31. In the capital, the overall average property price is forecast to go up by £90,412, from £551,294 to £641,706.
According to Sarah Brown (pictured right), senior strategy manager at Coventry Building Society, the projections underline how quickly affordability pressures can build for new entrants to the market.
“While a steady rise in house prices may be reassuring for existing homeowners, it risks making the path to homeownership even tougher for aspiring buyers,” she said. “Even relatively modest annual growth quickly adds up, and a 16% increase by the end of the decade could mean needing tens of thousands more for a typical purchase.
“For first-time buyers in particular, higher prices don’t just raise the deposit hurdle – they also increase the size of the mortgage needed to get on the ladder. That makes it more important than ever for buyers to plan ahead, build savings early, and seek advice on the options available to them.
“The key question now is whether earnings can keep pace with house price growth. Interest rates also play a role in shaping what borrowers can realistically borrow and repay. Without supportive income growth, or easing borrowing costs, many new buyers may find the goalposts continuing to move further out of reach.”
Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.
