Homeownership could become much more affordable under the second phase of the Government's Help to Buy scheme.
According to the latest research from property website Zoopla, the average deposit requirement to buy a property under the mortgage guarantee element of the Government's Help to Buy scheme has fallen by £33,325.
This means would-be homeowners would only need an average deposit of £11,108 to purchase a home under the scheme.
Help to Buy 2 launches today, three months earlier than planned. It aims to help aspiring homeowners with only a 5% deposit purchase a new build or existing property up to the value of £600,000.
Zoopla analysis revealed that there are currently 665,000 homes on the market that are eligible for Help to Buy 2 at an average asking price of £222,168.
Additionally, in six out of the ten regions across England and Wales the average deposit required to buy an eligible property has dropped below £10,000.
An average home in Yorkshire and the Humber can now be bought with a deposit of just £8,129 – the lowest level across the country.
In London, where house prices are much higher, the scheme will reduce the average deposit requirement to £16,103 – which equates to a significant drop of £48,309.
"Help to Buy 2 won't just narrow the aspiration gap, it could also close it entirely," said Zoopla's Lawrence Hall.
"House prices are beginning to rise, savings rates are low, inflation is consistently above target and wage increases aren't keeping pace. It makes saving for a 20% deposit on a property very difficult for many. Even people with well-paid jobs are being priced out of the market. The new scheme helps address that problem, making the first rung of the ladder much lower for would-be buyers who want to get a foot on it."
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