Age 35 now the average time when most people think they can afford to buy a home
12-09-2012
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Almost one in three can't afford a deposit, nearly one in five say no stamp duty for first time buyers would help them get on the ladder and 47% expect it will take ten years or more to save a deposit for their first property, according to the research from Post Office Mortgages.
Would-be buyers living in the South East and South West have most difficulty with raising a deposit, with 65% and 56% respectively anticipating it will take ten years or more to raise a deposit. Meanwhile, 47% of Londoners say it will take them much longer to get the funds together.
The research reveals 35 is now the average age a prospective homebuyer expects to buy their first home, rising steadily since the 1960s. Those who bought their first home in the early 1960s were on average just 24 years old.
However, Scots buck the 30 something first time buyer trend. They don't expect to get their foot on the ladder until they are at least 40, while all other regions expect to buy their first home in their thirties.
The biggest barrier first time buyers face is finding it hard to raise a deposit unless their circumstances change, such as getting a better paid job or inheriting some money and not being able to afford the mortgage repayments.
The Post Office says that this is perhaps an unfounded worry as, on average, renters in the UK pay £876 more a year than the average homeowner with mortgage payments and mortgage rates are historically low.
Some 29% would be encouraged to buy a home if they were offered more government assistance and 19% said a re-introduction of no stamp duty for first time buyers would help them get a foot on the property ladder. Hitting important milestones in life such as getting married or starting a family are also triggers for non-home owners to buy their first property.
‘The average age of a first time buyer has been creeping up over the past 50 years and a perceived ten year wait to raise a deposit doesn't help matters. The sheer size of the deposit is the most daunting thing for would be first time buyers, but it appears to be worth the wait if it works out cheaper than renting,’ said John Willcock, head of Post Office Mortgages.
‘However, there are a number of competitive mortgage options for people keen to buy their own home, and prospective buyers may not have to wait until they're 35 to get a foot on the ladder. In fact, since the beginning of the year, 27% of Post Office mortgage customers have been first time buyers compared to industry figures of 18% and on average Post Office mortgage customers are 31 years old, suggesting some people may be able to afford to buy a home sooner than they think,’ he explained.
‘In addition the Post Office also offers a range of products, which only require a ten per cent deposit and our recently launched Mortgage Specialists are able to help people through the process of choosing a mortgage, discussing each individuals needs and answering questions to help customers make an informed decision,’ he added.
