IN the 1970s the average Scottish house price was just £3617. In the 1980s it was more than £15,000, by the 1990s it was around £35,000 and come the year 2000 it had shot up to more than £51,000.
Jump to 2022, and that figure has reached an eye-watering £180,000 – about six times the average yearly income of Scots in full-time work.
Current first-time buyers are facing much higher house prices and heftier deposits than their parents, causing many to pay through the nose or abandon the market altogether for the rent sector.
Chris Stevenson had been looking for a flat for nine months prior to his offer being accepted, and among the dozens of viewings he went to, he applied for six before reaching lucky number seven.
That is all while working as a scientist in the NHS, and two teaching jobs.
The 33-year-old was keen to move after his Shawlands landlord increased the price of his rent by £200 a month, more than a third of what he was paying in total.
“I was expecting it to be a lot easier to successfully put an offer in place, to be honest, and probably that I wouldn’t have to offer so much more over the home report.
“I was under the expectation that if a property was going for £100,000 I would be able to get it for £105,000-£107,000.
“I didn’t expect to have any properties to be going to the closing date. The vast majority were. You’re talking 80%, if not more than that.”
Stevenson said one property he visited ended up selling for 22% more than the home report value, a figure outside his budget and one which would send chills down the spines of any budding homeowner.
“I’d like to stay in Shawlands but I’ve basically been priced out of the area that I’m renting in at the moment,” Stevenson told The National.
That is despite being able to afford his current rent, a price hundreds higher than his mortgage equivalent would be.
Asked what advice he would give to first-time buyers, Stevenson was blunt: “Lower your expectations. It was mentally and physically arduous. Mentally in the sense of being rejected so many times, but also physically, because I work full time, I was then having to leave work, go and view a flat, maybe two, and then still come home and do that maybe a couple of nights a week then still have to do all my normal life stuff.
“It’s a difficult market, especially for first-time buyers. It’s all-consuming.”
Sophie Cooney, (below) a 26-year-old from East Kilbride, was also looking for a flat in Glasgow. She had been saving up for years in a job she did not like so she could buy her own place.
“What I originally thought was if I could get somewhere with two bedrooms, that would be nice, but I really quickly realised that the way the places are at the moment I’d be lucky if I got a one-bedroom flat.
“I saved up quite a bit of money, or at least what I thought was a decent amount of money. And then I spoke to a mortgage advisor and he was like, ‘oh, no. You’ll need way more than that.’”
Cooney was advised to considerably up her deposit but the amount the advisor suggested was thousands more than she had already saved.
Her new savings goal could be a third more than her current savings. No easy task in a cost-of-living crisis.
She continued: “I honestly have no idea what you’re meant to do. I really don’t know. Because people would have to start to save when they’re like 16-17.
“I think I always assumed that at some point I’ll take a full-time job and then I’ll have enough money to buy somewhere. But that’s maybe not really the case so easily now.”
Even with savings in her Help to Buy ISA equal to more than 10% of her house budget, the 26-year-old is still struggling to find a place and is currently staying at home until she manages to put together the cash needed for her first bought home.
Asked if she’ll be forced to rent for the foreseeable future, Cooney told The National: “It’s probably the most viable option but I just really don’t want to. I am reluctant to because I don’t want to pay someone else’s mortgage. I want to have my own mortgage.”
Cooney has left the housing market for now as she continues to save, while it took Stevenson months of significantly being outbid on already high prices to land a place at all.
They’re not alone – buying a house now is not as easy as it once used to be. The current market only entrenches existing inequalities, according to housing expert Professor Duncan Maclennan (below).
He told The National: “Homeownership, house price increases and rises in housing wealth have significantly made the distribution of wealth in Scotland much less equal than it might otherwise have been. That’s a big issue.”
He pointed to a Nationwide Building Society study that revealed that 80% of young people trying to get into the market were helped by their parents.
“But what happens if your mum and dad are not very well off, and they’re renters?” he asked. “What happens if you come from a big family where you can’t give everyone a boost? So that social mobility of your life has been hampered by that.
“What I argue is that without realising it, governments have allowed home ownership to become a sector for speculation. That’s where we invest our money, as a bet, and basically assume that we have an asset that will grow, rather than a savings system, which it was set up to do.”
High deposits affect everyone trying to buy a house. Professor Douglas Robertson said the issue stems from the 2007/08 financial crisis, where the requirement for one “increased massively” following the economic shock, “cutting a whole swathe of people out of the housing market”.
Although they were later cut back, skyrocketing house prices meant they were still extortionate.
On top of that, a lack of affordable public housing being built and the long-term effects of Margaret Thatcher’s right to buy scheme means house prices may continue to rise.
“It might be as simple as building more public housing,” Professor Robertson explains.“To actually then reduce the demand for owner-occupied housing you’d have to build an awful lot of houses.”
Robertson added that the surging costs of raw materials mean councils may have a tough time footing the bill.
“The one thing we’ve noticed over the last 40 years is governments have not been particularly good at building houses.”
If you have been impacted by the housing crisis, contact Craig.Meighan@newsquest.co.uk or head to www.thenational.scot/my/ccn/assignment/uUW6uVhN/
