First-time buyers paying record prices

Individuals and couples are more determined than ever to get on the property ladder for the first time, despite the ongoing changes of the housing market.

According to the latest Halifax First Time Buyer Review, the average house price paid by first-time buyers was £207,693 in the first 6 months of 2017.

London saw the biggest jump in house price, up 66% to £409,975 – the highest on record. 

Average house prices in the South East were £276,773, followed by the South West at £202,700. 

When it came to putting a deposit down, the average amount from first-time buyers was £32,899 in the first half of 2017. 

First-time buyers in London put down the largest average deposit, more than 3 times the national average at £106,577. 

The South East (£50,144) and the South West (£35,655) were second and third highest, respectively.

Overall, the number of first-time buyers reached 162,704 in the first six months of 2017, up from 154,200 in the same period last year.

Furthermore, the average age of first-time buyers increased from 30 to 33 years old.

Saving for right amount of deposit

With house prices falling and in inflation squeezing household incomes, it’s becoming increasingly difficult for first-time buyers to save the right amount for a deposit.

There are several options available to start saving money towards getting on the property ladder without compromising your income.

The recently launched Lifetime ISA allows those aged 18 to 39 to save up to £4,000 each tax year while receiving a 25% government bonus (£1,000).

The maximum bonus you can receive over the course is £32,000, which can be used to buy a first home worth up to £450,000 following the first year after opening an account.

If that’s not your preferred option, there are various government schemes available, such as the Help to Buy ISA and Equity Loan Scheme depending on your situation.

If you’re having trouble saving for a deposit, the Equity Loan Scheme can help you secure a home with a 5% deposit. 

You can borrow 20% of the purchase price interest free for the first five years, although the property you’re buying must be worth no more than £600,000 and newly built.

Talk to us about purchasing your first property.