First-time buyers stump up record deposits to secure a home
First-time buyers are putting down record deposits for their first home, according to Halifax.
Nationally the average deposit is now £33,127, an increase of 71% from £19,364 in 2008. In London, the average first-time buyer deposit is an eye-watering £114,952 (27% of the purchase price) and a three-fold increase from £38,335 in 2008.
With property values and deposits at elevated levels, first-time buyers have become reliant on family assistance, with more than a third (34%)3 of new buyers getting financial help from parents.
First-time buyers have seen a 21% hike in property prices over the last 10 years, said Halifax, with the average price climbing from £172,659 in 2008 to £208,741.
This increase is more than double the 10% rise for all buyer types, and across Britain the average price of first-time buyer properties has out-performed the overall housing market.
In London, the average first-time buyer property price has seen the greatest increase (48%) during the last 10 years to £419,608, followed by the South-East (37% to £275,632) and East Anglia (30% to £210,639). There were relatively modest price rises in the North (8%) and Wales (9%) and in Northern Ireland the average first-time buyer price is a third lower (down 33% to £124,035 and the lowest in the UK) than in 2008.
Russell Galley, managing director at Halifax, said: “First-time buyers are having to dig deeper than ever to get onto the property ladder. With the average price now over £200,000 and deposits at £33,000 it’s not surprising that the average age of a first-time buyer has crept up to 31.
“Despite these increases, and the concern many young people feel about home ownership, the number of first-time buyers continues to grow and is nearly back to the peak seen of 2006. Government measures, such as Help to Buy, and record low mortgage rates continue to make buying more financially attractive than renting, with savings of £900 a year.”