According to Aldermore’s First Time Buyer Index, which surveyed 2,000 prospective first-time buyers, the average amount they are planning to raise for a deposit is £47,076.
Despite the high deposit, almost three quarters say they acknowledge the “long-term value of home ownership” and believe owning a home is a good investment for the future.
Nearly half are planning to buy a house of lower value than they initially thought as higher interest rates have increased average monthly payments, making home ownership less affordable.
The report continued that on average prospective buyers would consider spending 30 per cent of their monthly income after tax on their mortgage at most.
Half of prospective buyers are choosing to put their homebuying plans on hold with the hope property prices fall.
London and Oxford most expensive for first-time buyer to save for deposit
Regionally, the most expensive cities to raise a deposit are London and Oxford, with buyers having to save £145,272 and £132,201.
Sunderland was the cheapest at £21,117, meaning buyers in the capital are forking out six times more for a deposit.
Jon Cooper, head of mortgages at Aldermore, said: “The property market has been a difficult environment to navigate following the considerable volatility we saw in late 2022. Homeownership is increasingly expensive, and first-time buyers are having to raise larger deposits and lower their budgets accordingly. While this may be disheartening, first time buyers can still find their way onto the property ladder.
“It’s important now more so than ever, that prospective buyers speak to a broker. No matter where they are in their homebuying journey – whether they’re still saving for a deposit or ready to begin their property search – a broker will be able to guide them through the process, identify what they can realistically afford, and how much the whole homebuying process will cost.”
