The average amount for a deposit a first-time buyer needs to raise increased by 17% over the last 12 months, Experian’s Credit Barometer has revealed.
The average deposit amount for a first-time buyer is £30,945. The average amount people said they had saved for their deposit in July 2018 stood at £26,498. This suggests that those looking for a mortgage are having to save an increasing amount to secure their first home.
Amir Goshtai, managing director of Experian Marketplace and Affinity, said: “Our barometer shows it continues to remain challenging for younger people to get their first foot onto the property ladder with deposits continuing to grow, which means finding the right mortgage deal to make the most of their deposit is crucial.
“Low interest rates and falling house prices in certain areas mean now is an optimum time for first-time buyers and homemovers alike to make sure they get the best mortgage deal.
“Fixed rate mortgages remain a popular option with the British public as people look for stability and security in fixed monthly payments.”
Almost a year on from when it was first raised, the Bank of England announced today that the base rate will be held at 0.75%.
Borrowers remain watchful against a backdrop of uncertainty, as fixed rate mortgages remain the most popular choice.
Some 88% of mortgage applicants searched for a fixed rate mortgage in July 2019, compared to 6% for a variable and 5% for a tracker mortgage.
First-time buyer demand for mortgages remained relatively high in July 2019. Over half (56%) of all mortgage searches through Experian’s services in July were from this group.
One in five (17%) were looking for a mortgage for their next home and the rest (27%) searching for a remortgage.