First-time buyers 'need to save £20,000' to get on property ladder » Housing » 24dash.com

First-time buyers think they need to save nearly £20,000 in order to get on to the property ladder, a survey showed today.

The average first-time buyer thinks it will take them two years and they will need to save £19,100 before they can think about buying their own place, according to The Co-operative Bank and Places for People.

The current housing market downturn appears to have done little to deter potential buyers, with 54% saying they still think renting a property is throwing money down the drain.

A fifth also said they were optimistic that prices would rise over the long-term, while 30% said a property should be seen as a home and not an investment.

Around 46% of people said they had had to lower their expectations about the property they wanted in a bid to get on to the housing ladder.

Half of people said they would forgo a garage or an extra bathroom, while 40% were willing to compromise on how many bedrooms they had.

But 80% of people said they would not compromise on room size or location, while 78% felt the same way about a garden.

The proportion of first-time buyers making sacrifices in order to get on to the property ladder has increased sharply during the past year, with just 9% of people now saying they were not prepared to compromise their lifestyle in order to buy a home, up from 57% 12 months ago.

Half of people said they were forgoing eating out and having holidays abroad in order to become homeowners, double the figure last year, while four out of 10 are also buying fewer new clothes, cutting down on buying coffee and lunch from shops and reducing their alcohol consumption.

One in five people are making more drastic lifestyle decisions, such as delaying having children or getting married in order to buy their own home, while 11% have taken on an extra job.

Just half of first-time buyers said they thought the Government should do more to help people buy their first home, with only a quarter thinking the onus should be completely on them, while 19% thought the private sector should offer increased help.

Victoria Drummond, operations manager for Ownhome, the shared equity scheme run by The Co-operative Bank and Places for People, said: "This new research shows that the dream of owning a home is now out of reach for many first-time buyers, as they struggle to save for a deposit, against a backdrop of soaring household bills and the increased cost of living.

"It is vital that that the Government and the housing industry continue to offer simple, clear and innovative products that provide first-time buyers with the essential financial support needed to help them take their first steps onto the property ladder."

A spokesman for the Department of Communities and Local Government said: "We are working closely with mortgage lenders to ensure the market remains accessible for first-time buyers, and recently announced a major expansion of our affordable housing scheme to enable up to 10,000 more buyers to apply for a shared equity loan, boosting their purchasing power by up to 30%.

"The loan is interest free for the first five years and is part of a range of support that has helped more than 110,000 households realise their aspiration of home ownership since 1997.

"We are constantly looking at what more we can do to support first-time buyers in the current market."

Onepoll.com questioned 1,500 first-time buyers during August.