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The challenge facing first time buyers….

The challenge facing first time buyers….

Category: Mortgages

Updated: 13/04/2011
First Published: 13/04/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The difficulties facing first time buyers have been laid bare after it was revealed they will have to pay seven times the price their parents did to get on the housing ladder.

The average first time buyer home currently costs £136,842, according to Safe Home Income Plans (SHIP), an increase of 558% on the average price of £20,810 paid in 1983.

Highlighting the extent of the challenge even more starkly is the size of the average deposit a first time buyer needs to purchase a property at present.

Lenders currently require 23% of the asking price, or £31,474, over £10,000 more than the total value of their parents' first home.

As a result, it is unsurprising to learn that the average first time buyer who manages to snap up a home without assistance is 37 years old, eight years older than those who purchase with the assistance of their families.

Unfortunately, with inflation running high and older consumers worried about how they will pay for their retirement, many families are simply not in a situation to help.

"These housing figures really highlight the struggle that young people now face to take those first steps onto the housing ladder," said Andrea Rozario, director general of SHIP.

"House prices have risen far faster than incomes since the older generation bought their first homes.

"Furthermore, those who bought homes in 1983 and are now likely to be heading towards retirement will have benefitted from the increase in value of their home."

If you're trying to secure the finance to take your first step onto the property ladder, our mortgage best buy charts could have the answer.

HSBC and Yorkshire Building Society are amongst the lenders willing to lend to borrowers with just a 10% deposit, while Woolwich and first direct have mortgage deals open to those with a 15% deposit.

Find the best mortgage rate - Compare best selling mortgages



Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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