New figures show
L&C Mortgages reveals that the average first-time buyer deposit could be set to rise by nearly 60 per cent over the next 10 years. The current average deposit for first-time buyers sits at a huge £51,821, and could go up to as much as £65,930 by 2022. By 2027, first-time buyers may need to put down 28 per cent of a property’s value, which could amount to a deposit of £81,468, up by £29,647 from the current average deposit put down.
Looking at different cities across the UK, deposits are set to rise nationwide with the required amount going up by 75 per cent in the next 10 years in London, 62 per cent in Brighton and Hove and 59 per cent in Bristol. By 2027 the average deposit for a first-time buyer in London could go up to £244,842 – up £104,855 from the current £139,987 it is today. Even in Belfast, the city with the lowest percentage increase over the next ten years, deposits could rise by 41 per cent by 2027, jumping up from the £29,682 needed today to £41,755 in a decade’s time.
|UK cities||Deposit needed today||Deposit needed 2022||Deposit needed 2027||Total % increase by 2027|
|Brighton and Hove||£77,407||£100,032||£125,280||62%|
|Newcastle upon Tyne||£26,037||£31,826||£38,046||46%|
Source: L&C Mortgages Research (compiled by Opinium)
David Hollingworth from L&C said: “With this research predicting that the size of deposits required could rise considerably across the country, first-time buyers could be forgiven for giving up hope on owning their first home. There is some stark variation between cities but the fact that London deposits could be almost hitting a quarter of a million pounds by 2027 is alarming. It makes sense for first-time buyers to try and raise as big a deposit as possible but that is very much easier said than done in today’s current climate. Although there are mortgage deals available to as much as 95 per cent of the property price, rates on these types of deals will be higher than for those who have saved a larger deposit. Given the level of commitment that first-time buyers are having to make it’s of little surprise that they are often electing to fix their mortgage rate, so they know where they stand with their mortgage payments.”