A baby born today might never be able to afford to buy a house
Buying a property is out of reach for many of us in the current climate but spare a thought for the babies of today who may never be able to afford to buy their own house.
Our generation and previous generations have witnessed significant rises in property values but what about the next generation of home owners?
Rising house prices
New research has revealed that at the current rate of property growth, if a child is born in 2014, by the time they reach the average first time buyer age of 35, the average house price in 2048 will be an astounding £3.4 million.
The research by online estate agent eMoov.co.uk also revealed that 4-year-olds will most likely need £2.4 million to buy a property and even children of 10 years old face paying over £1.6 million for a property, requiring a deposit of over £320,000.
By 2032 the average 20% deposit needed to buy a property will equal the price of the average price of a property in 2014.
A house worth the national average of £205,199 by the end of 2014 is estimated to be worth £3,391,474 in the year 2048 if the historical pattern continues in property.
The bank of Mum and Dad
Generation Z's (The Millennial Generation) parents are already preparing, as 67% of parents polled by eMoov.co.uk stated that they will have to financially aid their children get on to the property ladder.
If the trend continues then the bank of Mum and Dad will become even more important for the next generation of home owners.
Current Age | Year | Years until typical FTB age | Value at Jan 1st | Annual Increase (Unadjusted for RPI) | Value at Dec 31st | Deposit Required |
35 | 2014 | 1 | £ 188,949 | £ 16,250 | £ 205,199 | £ 41,040 |
34 | 2015 | 2 | £ 205,199 | £ 17,647 | £ 222,846 | £ 44,569 |
33 | 2016 | 3 | £ 222,846 | £ 19,165 | £ 242,010 | £ 48,402 |
32 | 2017 | 4 | £ 242,010 | £ 20,813 | £ 262,823 | £ 52,565 |
31 | 2018 | 5 | £ 262,823 | £ 22,603 | £ 285,426 | £ 57,085 |
30 | 2019 | 6 | £ 285,426 | £ 24,547 | £ 309,973 | £ 61,995 |
29 | 2020 | 7 | £ 309,973 | £ 26,658 | £ 336,630 | £ 67,326 |
28 | 2021 | 8 | £ 336,630 | £ 28,950 | £ 365,581 | £ 73,116 |
27 | 2022 | 9 | £ 365,581 | £ 31,440 | £ 397,021 | £ 79,404 |
26 | 2023 | 10 | £ 397,021 | £ 34,144 | £ 431,164 | £ 86,233 |
25 | 2024 | 11 | £ 431,164 | £ 37,080 | £ 468,244 | £ 93,649 |
24 | 2025 | 12 | £ 468,244 | £ 40,269 | £ 508,514 | £ 101,703 |
23 | 2026 | 13 | £ 508,514 | £ 43,732 | £ 552,246 | £ 110,449 |
22 | 2027 | 14 | £ 552,246 | £ 47,493 | £ 599,739 | £ 119,948 |
21 | 2028 | 15 | £ 599,739 | £ 51,578 | £ 651,316 | £ 130,263 |
20 | 2029 | 16 | £ 651,316 | £ 56,013 | £ 707,330 | £ 141,466 |
19 | 2030 | 17 | £ 707,330 | £ 60,830 | £ 768,160 | £ 153,632 |
18 | 2031 | 18 | £ 768,160 | £ 66,062 | £ 834,222 | £ 166,844 |
17 | 2032 | 19 | £ 834,222 | £ 71,743 | £ 905,965 | £ 181,193 |
16 | 2033 | 20 | £ 905,965 | £ 77,913 | £ 983,878 | £ 196,776 |
15 | 2034 | 21 | £ 983,878 | £ 84,613 | £ 1,068,491 | £ 213,698 |
14 | 2035 | 22 | £ 1,068,491 | £ 91,890 | £ 1,160,381 | £ 232,076 |
13 | 2036 | 23 | £ 1,160,381 | £ 99,793 | £ 1,260,174 | £ 252,035 |
12 | 2037 | 24 | £ 1,260,174 | £ 108,375 | £ 1,368,549 | £ 273,710 |
11 | 2038 | 25 | £ 1,368,549 | £ 117,695 | £ 1,486,244 | £ 297,249 |
10 | 2039 | 26 | £ 1,486,244 | £ 127,817 | £ 1,614,061 | £ 322,812 |
9 | 2040 | 27 | £ 1,614,061 | £ 138,809 | £ 1,752,871 | £ 350,574 |
8 | 2041 | 28 | £ 1,752,871 | £ 150,747 | £ 1,903,618 | £ 380,724 |
7 | 2042 | 29 | £ 1,903,618 | £ 163,711 | £ 2,067,329 | £ 413,466 |
6 | 2043 | 30 | £ 2,067,329 | £ 177,790 | £ 2,245,119 | £ 449,024 |
5 | 2044 | 31 | £ 2,245,119 | £ 193,080 | £ 2,438,199 | £ 487,640 |
4 | 2045 | 32 | £ 2,438,199 | £ 209,685 | £ 2,647,884 | £ 529,577 |
3 | 2046 | 33 | £ 2,647,884 | £ 227,718 | £ 2,875,602 | £ 575,120 |
2 | 2047 | 34 | £ 2,875,602 | £ 247,302 | £ 3,122,904 | £ 624,581 |
1 | 2048 | 35 | £ 3,122,904 | £ 268,570 | £ 3,391,474 | £ 678,295 |
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