First time buyers facing a decade of saving to get on the ladder

Research by home buying platform, Yes Homebuyers, has revealed that the time it’s taking for first-time buyers (FTB) to save for their first home has grown by three years in some parts of the national property market.

Yes Homebuyers looked at the cost of the average FTB mortgage deposit at 15% of the current average FTB house price. Yes Homebuyers then looked at how long it was taking to save for this deposit based on tucking away 20% of an FTBs net monthly income and how this timeline has changed since 2012.

The research shows that with the current FTB house price sitting at £209,163 across Britain, a 15% FTB mortgage deposit requires a savings pot of £31,374.

With the average FTB taking home a net monthly income of £1,970, saving at a rate of 20% a month would see them put away just £394.

As a result, it’s currently taking the average FTB in Britain 6.6 years to save for a mortgage deposit. This is over a year (1.1) longer than it was taking them to save the same size mortgage deposit back in 2012.

Of course, in Britain’s more expensive regions this timeline has grown by a far greater margin.

In London, it currently takes the average FTB 11 years to save enough for a 15% deposit on the average London FTB property (£445,945). This timeline has increased by a huge 3 years since 2012, the largest increase of all areas of Britain.

In the South East, the current time for an FTB to save for a mortgage deposit is 7.9 years, having increased by 1.7 years since 2012. The East of England has also seen one of the largest increases, with FTBs now required to save for 7.7 years, an increase of 1.6 years since 2012.

While the South West has seen the time required to save increase by 1.5 years since 2012, the current FTB is required to save for a total of 8 years in the current market, meaning the region is home to the second-longest period to accumulate a mortgage deposit outside of London.

There is one region, however, where the FTB mortgage deposit saving timeline has reduced.

In the North East, the average FTB would take just 4.3 years to save a 15% deposit on the current FTB property price of £119,411. This is a marginal reduction on the 4.4 years that was required in 2012.

Scotland and Yorkshire and the Humber have seen some of the smallest increases, with FTBs now required to save for 0.4 years and 0.6 years longer respectively than they would have in 2012.

Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented:

“We seem to consider consistent house price growth as a cause for celebration in Britain. However, the reality is that these ever increasing property prices are pushing the dream of homeownership further out of reach for many first-time buyers.

To think that the timeline of saving for a mortgage deposit has increased by as much as three years since 2012 alone is quite shocking and really highlights the huge task facing those who wish to get their first foot on the ladder.

Instead of delivering on their promises of building new homes, the government has consistently added fuel to this affordability fire by stoking demand via schemes like Help to Buy. Until they actually increase the supply of stock reaching the market, this gap will continue to widen and the average age of the nation’s first-time buyers will continue to climb as they are forced to save for far longer, simply to accumulate enough for a mortgage deposit.”

Data on house prices based on FTB specific property prices, not all of market averages.

Earnings based on the average income for 22-29 and 30-39 year olds, with net monthly income adjusted based on the rate of tax for each specific year.

Sources UK House Price Index FTB House Price x 15% Office for National Statistics Monthly salary x 20% Mortgage Deposit / 20% Monthly Saving Months to save / 12
*Location*	2012		2020		Change
*Location*	Months to save 15% FTB mortgage deposit	Years to save 15% FTB mortgage deposit	Months to save 15% FTB mortgage deposit	Years to save 15% FTB mortgage deposit	Change in Months	Change in Years
Great Britain	66.2	5.5	79.6	6.6	13.5	1.1
England	68.6	5.7	83.6	7.0	15.0	1.2
London	95.9	8.0	131.6	11.0	35.7	3.0
South East	74.3	6.2	95.1	7.9	20.8	1.7
East of England	72.6	6.0	91.9	7.7	19.4	1.6
South West	79.1	6.6	96.5	8.0	17.4	1.5
East Midlands	59.0	4.9	71.9	6.0	12.9	1.1
West Midlands region	63.8	5.3	72.1	6.0	8.3	0.7
Wales	60.0	5.0	68.1	5.7	8.2	0.7
North West	55.6	4.6	62.8	5.2	7.2	0.6
Yorkshire and the Humber	58.3	4.9	65.2	5.4	6.8	0.6
Scotland	49.2	4.1	53.4	4.5	4.3	0.4
North East	53.0	4.4	51.8	4.3	-1.2	-0.1

*Location*	2020
*Location*	2020 Average FTB House Price	2020 15% Mortgage Deposit	Ave FTB net salary pm - 2020	20% net salary saving pm - 2020	Months to save for Ave FTB 15% deposit - 2020	Years to save for Ave FTB 15% deposit - 2020
Great Britain	£209,163	£31,374	£1,970	£394.04	79.6	6.6
England	£222,334	£33,350	£1,995	£398.94	83.6	7.0
London	£445,945	£66,892	£2,542	£508.37	131.6	11.0
South East	£271,632	£40,745	£2,142	£428.34	95.1	7.9
East of England	£250,166	£37,525	£2,041	£408.14	91.9	7.7
South West	£228,064	£34,210	£1,773	£354.51	96.5	8.0
East Midlands	£174,620	£26,193	£1,823	£364.52	71.9	6.0
West Midlands region	£177,473	£26,621	£1,846	£369.26	72.1	6.0
Wales	£155,270	£23,291	£1,710	£341.94	68.1	5.7
North West	£151,357	£22,704	£1,806	£361.25	62.8	5.2
Yorkshire and the Humber	£154,426	£23,164	£1,777	£355.49	65.2	5.4
Scotland	£133,677	£20,052	£1,876	£375.25	53.4	4.5
North East	£119,411	£17,912	£1,728	£345.59	51.8	4.3
Sources	UK House Price Index	FTB House Price x 15%	Office for National Statistics	Monthly salary x 20%	Mortgage Deposit / 20% Monthly Saving	Months to save / 12


*Location*	2012
*Location*	2012 Average FTB House Price	2012 15% Mortgage Deposit	Ave FTB net salary pm - 2012	20% net salary saving pm - 2012	Months to save for Ave FTB 15% deposit - 2012	Years to save for Ave FTB 15% deposit - 2012
Great Britain	£141,993	£21,299	£1,609	£321.88	66.2	5.5
England	£149,337	£22,401	£1,632	£326.50	68.6	5.7
London	£273,318	£40,998	£2,138	£427.59	95.9	8.0
South East	£180,804	£27,121	£1,825	£364.92	74.3	6.2
East of England	£161,365	£24,205	£1,668	£333.59	72.6	6.0
South West	£154,516	£23,177	£1,466	£293.11	79.1	6.6
East Midlands	£117,031	£17,555	£1,488	£297.63	59.0	4.9
West Midlands region	£122,638	£18,396	£1,441	£288.29	63.8	5.3
Wales	£110,181	£16,527	£1,378	£275.67	60.0	5.0
North West	£107,702	£16,155	£1,452	£290.38	55.6	4.6
Yorkshire and the Humber	£110,983	£16,647	£1,427	£285.36	58.3	4.9
Scotland	£99,488	£14,923	£1,518	£303.53	49.2	4.1
North East	£99,036	£14,855	£1,402	£280.30	53.0	4.4