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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 It is now over 6 months old so the content may be out of date.


Lieke Braadbaart

Online Writer
Published: 13/08/2018

In the past decade, first-time buyers have seen property prices increase by a whopping 21%, according to the latest findings from Halifax. The average price for those looking to buy their first home has gone up from £172,659 in 2008 to £208,741 this year as a result, double the rise that occurred across all buyer types.

Deposit woes

All of this means, inevitably, that first-time buyers are having to stump up a bigger deposit as well. Nationally, the average deposit now stands at £33,127, which marks a 71% rise from the £19,364 that first-time buyers needed in 2008.

Despite this high number, which may seem insurmountable to some, young Brits are still dreaming of owning their own home – only one in five believe they'll be renting forever. And yet, 34% of new buyers have been reliant on financial help from their parents, and a third of those who haven't made the jump yet think they'll only be able to get on the property ladder by inheriting the cash.

Many other would-be first-time buyers are living at home until they can afford to buy (35% among 18-34-year-olds), potentially scuppering their parents' dreams of downsizing, and some (16%) are even considering moving abroad simply so they can find more affordable housing. If you're a young person with dreams of owning your own home, the key is always to keep saving and be smart about what you're spending your money on.

Silver lining

Despite the high costs associated with purchasing property, the number of first-time buyers has increased by around 3% in the first six months of 2018, rising to 175,500 compared to 171,200 in the first six months of 2017. This marks the sixth increase in the last seven years, and the third consecutive year in which the number of first-time buyers has topped 150,000.

It's also double the number seen in the first half of 2009, when it stood at a record low of 72,700. Halifax's data suggests that many have been helped by the Help to Buy scheme – first-time buyers can get a 25% Government bonus towards a deposit when saving through a Help to Buy ISA – which has helped 128,317 first-timers onto the housing ladder since 2013.

"First-time buyers are having to dig deeper than ever to get onto the property ladder," Russell Galley, managing director at Halifax, said. "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 … [Additionally,] record low mortgage rates continue to make buying more financially attractive than renting."

What next

Those still saving up for their first home may want to take a look at the Help to Buy ISA, or at least make sure their savings are in a Best Buy savings account so they can earn decent interest on it. If you're among the lucky few young people who've managed to save up enough to take that first step, don't forget to make sure you have a competitive first-time buyer mortgage so you can make the most out of your new life as a homeowner.


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