Enable’s IFAs of Bishop’s Stortford are all too aware that saving for a deposit is a challenge. According to the Nationwide Building Society a typical 20% deposit in London is now more than £80,000, and the average deposit around the UK could be closer to £20,000. With the widespread squeeze on wages and low interest rates it really is more difficult to raise the money than a decade ago.
The Nationwide study also calculated the length of time it believes it would take for buyers in each region to save for the required deposit. They based this on the idea that people are tucking away 15% of their take-home pay. For most it would take about eight years for an average buyer to save for a deposit. But this rises to nine years in the South East of England and to more than 10 years in London.
Inevitably this has created a real pressure on first-time buyers to save and many have also turned to parents of other relatives to help. “The Bank of Mum and Dad, or Granny and Grandad, can come with big legal pitfalls, particularly if you’re borrowing money with a partner,” say Iona Bain, founder of the Young Money Blog. “The only other alternative is to simply save harder for longer.” She says.
Enable’s experienced IFA’s know how important a first home can be and are here to help you or your family look at the options for house buying and saving for a deposit.