20pc of FTBs couldn’t get a mortgage in 2011

Nia Williams

January 23, 2012

Just over a quarter of prospective first-time buyers said they would only be able to put down 5% for a deposit on a future property.

The majority of future first-time buyers at 28% said they could put down a 10% deposit.

Data released in October 2011 from the Council of Mortgage Lenders reported that deposits for first-time buyers had remained stable in recent months at an average 20% of property value.

The UKMC said this suggested that those at the higher end of the loan to value scale had unrealistic expectations of their chances for obtaining a mortgage.

Anna Spivack, analyst at RFi, said: “These individuals do have some products available to them, particularly from building societies offering a 95% option for first-time buyers.

“However while there are 95% LTV products on the market, the situation for first-time buyers without a considerable deposit amount is much more challenging in the current economic climate than it was for those buying in previous years.”

Some 29% of prospective first-time buyers were looking for mortgages between £100,001 to £150,000 and just over a fifth were looking to borrow between £50,001 to £100,000.

Less than 5% of prospective first-time buyers said they needed between £250,001 and £300,000 for a mortgage.

Spivack added: “While these are reasonable figures for a first home given current property prices in the UK, these figures illustrate why the majority of deposit amounts stated by the future first-time buyer group are 10% or below.

“With nearly 60% of the group earning £30,000 or less per annum, saving a 20% deposit for a £175,000 property would be extremely challenging for many.”

The UK Mortgage Council managed by RFi surveyed 333 future first-time buyers between 26th November and December 6th 2011.


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