Home Residential Property First-time buyers to face huge rise in mortgages

First-time buyers to face huge rise in mortgages

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7th Dec 17 9:00 am

New figures show

L&C Mortgages reveals that the average first-time buyer deposit could be set to rise by nearly 60 per cent over the next 10 years. The current average deposit for first-time buyers sits at a huge ยฃ51,821, and could go up to as much as ยฃ65,930 by 2022. By 2027, first-time buyers may need to put down 28 per cent of a propertyโ€™s value, which could amount to a deposit of ยฃ81,468, up by ยฃ29,647 from the current average deposit put down.ย 

Looking at different cities across the UK, deposits are set to rise nationwide with the required amount going up by 75 per cent in the next 10 years in London, 62 per cent in Brighton and Hove and 59 per cent in Bristol. By 2027 the average deposit for a first-time buyer in London could go up to ยฃ244,842 โ€“ up ยฃ104,855 from the current ยฃ139,987 it is today. Even in Belfast, the city with the lowest percentage increase over the next ten years, deposits could rise by 41 per cent by 2027, jumping up from the ยฃ29,682 needed today to ยฃ41,755 in a decadeโ€™s time.ย 

UK cities Deposit needed today Deposit needed 2022 Deposit needed 2027 Total % increase by 2027
London ยฃ139,987 ยฃ188,966 ยฃ244,842 75%
Brighton and Hove ยฃ77,407 ยฃ100,032 ยฃ125,280 62%
Bristol ยฃ58,035 ยฃ74,192 ยฃ92,062 59%
Norwich ยฃ40,890 ยฃ51,626 ยฃ63,364 55%
Edinburgh ยฃ37,661 ยฃ47,467 ยฃ58,204 55%
Southampton ยฃ45,262 ยฃ56,775 ยฃ69,349 53%
Cardiff ยฃ34,400 ยฃ42,593 ยฃ51,485 50%
Leeds ยฃ29,589 ยฃ36,633 ยฃ44,252 50%
Manchester ยฃ28,672 ยฃ35,513 ยฃ42,912 50%
Birmingham ยฃ30,602 ยฃ37,792 ยฃ45,564 49%
Plymouth ยฃ36,384 ยฃ44,762 ยฃ53,806 48%
Sheffield ยฃ26,193 ยฃ32,263 ยฃ38,797 48%
Glasgow ยฃ21,876 ยฃ26,904 ยฃ32,291 48%
Nottingham ยฃ25,132 ยฃ30,693 ยฃ36,650 46%
Newcastle upon Tyne ยฃ26,037 ยฃ31,826 ยฃ38,046 46%
Liverpool ยฃ21,292 ยฃ25,852 ยฃ30,716 44%
Belfast ยฃ29,682 ยฃ35,528 ยฃ41,755 41%

Source:ย  L&C Mortgages Research (compiled by Opinium)

David Hollingworth from L&C said:ย โ€œWith this research predicting that the size of deposits required could rise considerably across the country, first-time buyers could be forgiven for giving up hope on owning their first home. There is some stark variation between cities but the fact that London deposits could be almost hitting a quarter of a million pounds by 2027 is alarming. It makes sense for first-time buyers to try and raise as big a deposit as possible but that is very much easier said than done in todayโ€™s current climate. Although there are mortgage deals available to as much as 95 per cent of the property price, rates on these types of deals will be higher than for those who have saved a larger deposit. Given the level of commitment that first-time buyers are having to make itโ€™s of little surprise that they are often electing to fix their mortgage rate, so they know where they stand with their mortgage payments.โ€

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