The figures are truly eye-watering. Single first-time buyers now need a £74,000 deposit to get a mortgage with a typical lender, according to the property website Rightmove. This figure is based on a single buyer on a typical wage being able to borrow a maximum of 4.5 times their salary to buy the average first-time buyer home at a cost of £225,552.
If you’re buying in London, where the average asking price is £502,251 for a first-time buyer, the financial pressure is even worse. Things are obviously a little easier for first-time buyers who are looking to get on to the property ladder as partners.
For anyone out there without the Bank of Mum and Dad who feels queasy at these figures but still wants to get on the property ladder, I say this: get yourself a game plan and buckle up for several years of shovelling your cash to one side.
It turns out my experience is typical: first-time buyers take an average of eight years to save enough money for a downpayment on their first home, according to the Barclays Mortgages’ First Time Buyer Index.
I admit seven and a half years of saving was a slog. There were years I was really motivated and saved a lot. There were years I wasn’t – when I was close to giving up on property – and saved less.
I saved money by having a couple of no-holiday years (hard), staying in a difficult house share for an insanely low rent (really hard), a no-spending-on-clothes-year (less hard) and a £12-a-year subscription to borrowmydoggy.com to avoid the expense of dog ownership.
I sold stuff I no longer needed on eBay, did bits of tutoring and back in the days when banks were paying 5pc interest on savings I’d move my money around. I stuck to my cheap thrills of swimming, baking and discounted Eurostar tickets, but couldn’t give up one luxury: eyelash extensions.
My partner and I didn’t have expensive outgoings such as children or a car. What I did have, however, was a visceral need to own a home. I had lived in rented accommodation for my whole life.
Scrutinise every offer of government help. Is a Lifetime Isa actually likely to help you? Only if you’re in a position to save and tie up the maximum £4,000 a year for a few years to take advantage of the £1,000 bonus while looking to buy a home for less than £450,000.
