The latest research shows that close to half of those looking to purchase their first home have used the COVID-19 lockdowns to save the cash needed to pay for a deposit.
This study by the estate agency Purplebricks shows that 43% of people aiming to buy a first property have saved the money required to pay the deposit without outside help during the lockdown. This compares with 29% – roughly one third – of buyers who got themselves into that position back in 2016. Furthermore, the study also reveals the amount that first-time buyers are looking to pay as a deposit has fallen.
The average deposit amount that they are paying is now £27,521, in comparison to £32,954 five years ago. What makes this more surprising is that the same period has seen the cost of a home rise dramatically. It has been suggested that the mortgage guarantee scheme is a factor in this.
Purplebricks’ Divisional Sales Director Susan Gregory spoke to Financial Reporter about the rising numbers paying for their own deposits, saying that the restricted spending options caused by the lockdowns had led to it, before adding:
“It is really encouraging to observe this growing trend for first-time buyers to finance their first property purchases under their own steam.”
Gregory concluded by pointing out that this was one of several changes in the behaviour of home buyers during the past year.
If people can afford their own deposits, it will make it easier for those with a CeMAP qualification to find them a mortgage.