Are you struggling to get on the housing ladder? Well, there seems to be a straightforward reason for that…
A new study into industry salaries across the UK has revealed that none of the average annual wages meet the necessary salary required to afford owning a home. The research analysed ONS data on average salaries across the nation for full-time workers and compared them to the figure needed to buy an average property.
Using its salary checker tool, Go.Compare Home Insurance calculated that the average salary needed for a single person to buy a house in the UK is £59,307.
When analysing average earnings across the nation, it found that no industry, on average, offers a wage high enough to cover that.
The industries coming closest
Workers in the electricity, gas, steam and air conditioning supply industry have the highest chance of earning enough to be able to afford a home, according to the study, earning £8,779 shy of the amount needed. Those in financial and insurance services are second-closest to reaching the amount needed to own a home at £11,110 less than the required salary.
Other industries that just fall short include mining and quarrying, information and communication, and professional, scientific and technical activities.
Industry and their gross median annual pay, full-time (£):
Electricity, gas, steam and air conditioning supply: 50,528
Financial and insurance activities: 48,197
Mining and quarrying: 46,978
Information and communication: 44,733
Professional, scientific and technical activities: 41,453
The industries some way off
Unfortunately, the average salaries of several industries fall far below what is required to own a home, according to the insurance comparison site’s calculations. Workers in the accommodation and food services, agriculture, forestry and fishing industries and other services all earn less than £30,000, leaving a large gap between the required salary.
Workers in the goods and services for households industry are furthest from this goal, needing to double their salary to reach this. Domestic personnel such as cooks, gardeners, chauffeurs, caretakers, babysitters, tutors, and secretaries earn an average of just over £25,000 annually, meaning they see a massive yearly shortfall of over £34,000.
Industry and their gross median annual pay, full-time (£):
Household goods and services – domestic personnel: 25,085
Accommodation and food service: 25,522
Agriculture, forestry and fishing: 29,355
Other service activities: 29,692
Wholesale and retail trade; repair of motor vehicles and motorcycles: 29,963
Undoubtedly, mortgage rates need to come down to help renters onto the property ladder – and helpful schemes need to be promoted more to those in need.
Nathan Blackler, home insurance expert at Go.Compare, said: “It’s shocking to see that not even one of our industries offers a wage that is high enough for its workers to afford a home. Although these are only average salaries, this is the difficult situation that most renters and residents who haven’t yet bought a property find themselves in.
“When homeownership is this unattainable, more definitely needs to be done. Many of those looking to get on the property ladder believe that there should be extra help for first-time buyers, whether that is through subsidised house prices, stamp duty relief, or improved government schemes such as help-to-buy ISAs, shared ownership or 99% mortgages.”
More information about the research and resident’s opinions on homeownership can be found on Go.Compare’s website.