Tony Ward is chief executive of Home Funding
Interesting survey from the Yorkshire Building Society out this week which suggests that 56% of potential first time buyers are concerned about how long it would take to save up for a deposit to buy a first property.
The research goes on to say that it can take up to eight years on average so probably a lot longer if you live in London.
It also says that 7% of potential buyers plan to go to their parents to ask for extra help and almost a fifth of first-time buyers who had bought a home in the last year told the study they had had help from ‘the bank of Mum and Dad’ with their deposit compared with 13% of people who bought a property five years ago.
Two things come to mind. Eight years is a long time to save up for a 20% deposit so perhaps more should be done to help this largely disenfranchised group to get on the property ladder.
I think this is an area that the current Funding for Lending scheme doesn’t really address in its present form, positive though the initiative is.
Maybe the scheme could be refined to assist this group – it’s a segment of the market that is presently being overlooked. Lenders should be incentivised to target the higher LTV brackets with appropriate products.
And secondly, shouldn’t we as responsible lenders look at developing more innovative products for promoting shared ownership?
The market is obviously out there so it makes perfect sense to invest our time and ideas in this area.
There are shared equity initiatives which we could and should exploit.