In response to the rising costs, half of the aspiring first-time buyers (55%) are aiming to raise a larger deposit than initially planned, a recent survey from Aldermorev found.
Despite the challenges, 72% of prospective buyers still view homeownership as a valuable long-term investment. However, the need for larger deposits and potential for higher monthly repayments has led 49% to consider buying lower-value properties. On average, these buyers are prepared to spend up to 30% of their post-tax monthly income on mortgage repayments.
Regionally, London and Oxford are the most expensive cities for first-time buyers to raise a deposit, with required amounts being £145,272 and £132,101, respectively. In contrast, Sunderland emerges as the most affordable, requiring a deposit of £21,117.
Jon Cooper, head of mortgages at Aldermore, advises prospective buyers: “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.
“This will help give first-time buyers a clear and actionable path to homeownership amid these uncertain conditions.”
