Study reveals it takes 24 years to save deposit for a home

January 9, 2016 by Brendan O'Neill

Property Market

Recent research indicates that a person who puts away five percent of the disposable income they have each year may have to save for 24 years to get a suitable deposit for a property.

In 1997, it took just three years to save for a deposit to buy a house, suggesting that the rapidly rising property prices are becoming a problem for first time buyers. The latest survey of household finances produced by the Bank of England was used by the Resolution Foundation to discover whether the rising property prices were a problem for first time buyers. According to the results of the study, the schemes launched by the government, including Help to Buy, hadn’t encouraged more people to buy rather than rent a home.

Matt Whittaker, the chief economist for Resolution, was interviewed by the Guardian, saying:

“To the extent that these schemes have stoked demand and so propped up house prices in recent years, they have served to make homeownership even less attainable for many, while increasing the gains flowing to older homeowners who have been the main beneficiaries of the sustained housing boom.”

The study also revealed that more than a quarter of people aged under 45 don’t think they will ever be able to afford to purchase their own home. When the study looked at the UK population’s poorest fifth, the percentage increased to 39%.

A mortgage adviser undertakes CeMAP training so that they are able to advise whether a mortgage is the most suitable option for potential buyers, helping to find an affordable product in many cases.