First-time buyers in Exeter has to borrow 5.3 times their salary

First-time buyers need to borrow up to five times their salary to get on the property ladder in Exeter, new figures show.

The city ranks ninth in a list of 20 of the country’s least affordable locations compiled by online mortgage broker Mojo Mortgages.

Homes in Exeter typically command a price tag of more than £333,000, compared to the national average of £287,830.

With residents typically earning £26,710 a year, a couple who’d saved a 15 per cent deposit would have to borrow seven times their salary for a mid-market home.

The top 20 most expensive towns and cities are all in or around the South of England, apart from Stratford-upon-Avon in 18th.

Location	Average annual salary (£)	Total salary of couple both earning average salary (£)	Average house price (£)	Average deposit in £ (based on 15%)	Remaining mortgage balance (£)	Average income multiple required
Bath	£29,940.00	£59,880.00	£528,530.00	£79,279.50	£449,250.50	7.50
Oxford	£33,263.00	£66,526.00	£570,357.00	£85,553.55	£484,803.45	7.29
London	£42,001.00	£84,002.00	£704,138.00	£105,620.70	£598,517.30	7.13
Poole	£28,753.00	£57,506.00	£454,658.00	£68,198.70	£386,459.30	6.72
Brighton	£30,946.00	£61,892.00	£462,035.00	£69,305.25	£392,729.75	6.35
Guildford	£41,369.00	£82,738.00	£613,099.00	£91,964.85	£521,134.15	6.30
Watford	£32,965.00	£65,930.00	£456,029.00	£68,404.35	£387,624.65	5.88
Slough	£33,198.00	£66,396.00	£457,549.00	£68,632.35	£388,916.65	5.86
Exeter	£26,710.00	£53,420.00	£333,933.00	£50,089.95	£283,843.05	5.31
Cambridge	£39,112.00	£78,224.00	£480,366.00	£72,054.90	£408,311.10	5.22
Bournemouth	£28,753.00	£57,506.00	£350,230.00	£52,534.50	£297,695.50	5.18
St Albans	£50,356.00	£100,712.00	£611,025.00	£91,653.75	£519,371.25	5.16
Canterbury	£30,867.00	£61,734.00	£368,661.00	£55,299.15	£313,361.85	5.08
Reading	£37,324.00	£74,648.00	£445,438.00	£66,815.70	£378,622.30	5.07
Bristol	£30,579.00	£61,158.00	£362,563.00	£54,384.45	£308,178.55	5.04
Stevenage	£29,209.00	£58,418.00	£345,766.00	£51,864.90	£293,901.10	5.03
Eastbourne	£27,869.00	£55,738.00	£328,212.00	£49,231.80	£278,980.20	5.01
Stratford-upon-Avon	£35,311.00	£70,622.00	£415,390.00	£62,308.50	£353,081.50	5.00
Cheltenham	£34,896.00	£69,792.00	£409,614.00	£61,442.10	£348,171.90	4.99
Maidstone	£32,249.00	£64,498.00	£377,294.00	£56,594.10	£320,699.90	4.97

At the other end of the spectrum, some of the best bargains to be found are in the North of England and Scotland, with the top ten most affordable areas as follows:

Location	Average annual salary (£)	Total salary of couple both earning average salary (£)	Average house price (£)	Average deposit in £ (based on 15%)	Remaining mortgage balance (£)	Average income multiple required
Glasgow	£29,557.00	£59,114.00	£200,957.00	£30,143.55	£170,813.45	2.89
Doncaster	£27,661.00	£55,322.00	£187,706.00	£28,155.90	£159,550.10	2.88
Wigan	£28,970.00	£57,940.00	£184,541.00	£27,681.15	£156,859.85	2.71
Durham	£27,859.00	£55,718.00	£176,834.00	£26,525.10	£150,308.90	2.70
Darlington	£27,843.00	£55,686.00	£172,765.00	£25,914.75	£146,850.25	2.64
Blackpool	£22,567.00	£45,134.00	£139,752.00	£20,962.80	£118,789.20	2.63
Barnsley	£27,411.00	£54,822.00	£167,335.00	£25,100.25	£142,234.75	2.59
Hartlepool	£25,530.00	£51,060.00	£147,916.00	£22,187.40	£125,728.60	2.46
Gateshead	£27,309.00	£54,618.00	£153,159.00	£22,973.85	£130,185.15	2.38
Bradford	£27,413.00	£54,826.00	£151,858.00	£22,778.70	£129,079.30	2.35
Hull	£29,193.00	£58,386.00	£158,228.00	£23,734.20	£134,493.80	2.30

Richard Hayes, CEO and co-founder at Mojo Mortgages said it’s further evidence that first-time buyers are being squeezed out of the city where they grew up or work.

“First-time buyers could now borrow as much as seven times their salary – but this would be a big stretch for many couples who would struggle to buy a property in Exeter.

“Lack of affordable housing has repercussions, not only for the individuals involved but the wider economy and community if workers in lower-paid jobs are priced out of the market.

“Enabling people to borrow more might help them onto the property ladder but much will depend on their circumstances as lenders and brokers must apply strict affordability checks. It’s also important that buyers weigh up whether the location offers the best quality of life for them.”

Mojo Mortgages compared average earnings with house prices and found that 30 towns and cities in the UK were above the traditional 4.5 salary multiplier applied to borrowers.

But it found that buyers could still enjoy the buzz of a big city, without paying a premium, in Manchester and Birmingham where wages are above average and housing more affordable.

A couple buying a £235,650 home in Manchester would only need to borrow 3.77 times their salary, while in Birmingham it’d be 3.56 times for a £235,681 property.

Edinburgh and Glasgow are relatively affordable too, as are cities such as Liverpool, Newcastle and Leeds – but bargain hunters could also snap up a property in Hull borrowing just 2.30 times their salary, Bradford at 2.35 times or Gateshead at 2.38.

For for the full research, please visit: https://mojomortgages.com/mortgage-income-multiples-the-cost-of-borrowing-in-2022