Average Deposit For UK First-Time Buyers Up By £10,000 Last Year
The typical new buyer deposit in London increased by £20,000, with the average in the capital hitting more than £130,000, according to a property index by Halifax.
Across the UK, the average deposit in 2020 was £57,278, up from £46,499 in 2019 - that's a 23 percent increase, or £10,829.
In London, first-time buyers were putting down 18 percent more for their deposit in 2020 than in 2019, with the average rising from £110,145 to £130,357.
Wales saw an increase too - the average there went up by 25 percent, from £26,029 to £32,663.
During the pandemic, low-deposit mortgages were put on hold, but it didn't stop first-time buyers - in fact, half of house purchase loans were from those buying their first property. This is still down slightly from 51 percent in 2019.
Russell Galley, managing director, Halifax, said: "Whilst these figures confirm the almost inevitable fall in the overall number of first-time buyers in 2020 - with the entire housing market effectively shuttered during the first national lockdown - they also underline just how strong the bounce back was in the second half of the year.
"Despite the obvious challenges presented by soaring house prices, not least the need to raise an even bigger deposit, first-time buyers still accounted for half of all home purchases, a reassuring statistic given their overall importance to the market.
"However, with the economic impact of the pandemic likely to be felt most keenly by the young and those in lower-paid jobs, the need to prioritise improved housing availability and affordability for all those looking to make that first step on to the property ladder becomes ever greater."
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To help younger people and first-time buyers get on to the property ladder, the government is launching a new Help To Buy equity loan scheme this year.
It means that first-time buyers will be able to apply for new-build homes, and it will cover the period from 1 April 2021 to 31 March 2023.
The loan means that potential buyers could borrow up to 20 percent of the cost of a house - or 40 percent or those in London.
Buyers will need to stump up a deposit of at least five percent. They also need to arrange a repayment mortgage up to the value of 25 percent or higher for the home in order to make up the remaining amount.
There are also eligibility requirements on the house, which must be newly built.
The maximum cost of the home varies depending on where you live - and can be up to £600,000 in London.
It's also required that applicants can afford the monthly fee and interest payments and not own any other properties.
They are also unable to sublet the house without consent.
Applicants can rent out rooms in the property to tenants, but they must continue to live in the house themselves.
Featured Image Credit: PA
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