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First-Time Buyers 'need £37,000' To Purchase Home

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http://www.bbc.co.uk/newsbeat/10615736

First-time buyers now need to find an average of £37,000 up front before they can buy their first home, according to figures seen by Newsbeat.

House prices have risen over the past year and banks are still asking for a large deposit to secure the best mortgage deals.

"Getting that kind of money together can take a good few years," said Anthony, 28, from Leamington Spa.

"You've got to live at the same time, so you have to sacrifice a lot."

The number of new first-time buyers has fallen to a near record low while the average age has risen to 29 or 37 without financial help from parents.

Deposits up

The latest report from the Council of Mortgage Lenders (CML) shows the typical price of a first home in the UK now stands at £139,000, although there are wide variations depending on where you live.

Prices have been drifting up along with a general rise in the housing market.

If I was renting now that would take me years to save up, and my bank of mum and dad haven't got that sort of money.

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http://www.bbc.co.uk/newsbeat/10615736

If I was renting now that would take me years to save up, and my bank of mum and dad haven't got that sort of money.

Newsbeat? dont they realise the problem is that just not enough parents are dying leaving fortunes to their kids?

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The wife an I have got a bit more than that but are still struggling to find somewhere.

It wasn't easy to save, we had to go without a lot of things most people say you 'need'. But buying a home to start a family is still out of our league.

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The wife an I have got a bit more than that but are still struggling to find somewhere.

It wasn't easy to save, we had to go without a lot of things most people say you 'need'. But buying a home to start a family is still out of our league.

try renting..the marital bed is exactly the same, whoever owns the walls.

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As a guess, ordinary, median earners trying really hard to save a deposit the old-fashioned way, £4k a year might be achievable. That makes £37k over nine years away from a standing start.

I suspect, though, that most present-day median earners (or actually people in general) probably don't have the saving ethic sufficiently to save that fast.

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"Many economists expect to see house prices fall back over the next 12 months which could help any potential buyer thinking about getting that first place."

What a nice change to see an admittance for once, that lower house prices, are actually a good thing for buyers.

An average of £37k now needed, up from £14k, in only 2 years. :o

That is a huge amount of cash for FTB'ers to find now, if bank of mum and dad cannot oblige, especially if they are only putting it all on a depreciating asset.

I wonder, does this mean that BTL'ers will also need to find this amount now, or do they not need to, if they can prove average rentals cover their mortgage costs ?

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That should be rephrased in the old-fashioned HPC lingo as "First-Time Buyers require 37,000£ in cash to be allowed to borrow stupids amount of debt". It's just that people don't see it that way.

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That should be rephrased in the old-fashioned HPC lingo as "First-Time Buyers require 37,000£ in cash to be allowed to borrow stupids amount of debt". It's just that people don't see it that way.

Hard to part with £37K to a buy a flat, when you have saved so long...you really would expect something for your money and your future 25 years of payments.

you think...wow, im pretty secure, ive got £37K...then think...wow, i have no cushion whatsoever, and the flat is the same as the one im renting and Im STILL Paying out for it every month...AND Im liable for all the repairs, the maintenance fees and everything else.

Its a toughy.

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What a nice change to see an admittance for once, that lower house prices, are actually a good thing for buyers.

An average of £37k now needed, up from £14k, in only 2 years. :o

That is a huge amount of cash for FTB'ers to find now, if bank of mum and dad cannot oblige, especially if they are only putting it all on a depreciating asset.

I wonder, does this mean that BTL'ers will also need to find this amount now, or do they not need to, if they can prove average rentals cover their mortgage costs ?

Ah ha! Buy on a btl mortgage and rent to yourself. Simple.

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As a guess, ordinary, median earners trying really hard to save a deposit the old-fashioned way, £4k a year might be achievable. That makes £37k over nine years away from a standing start.

I suspect, though, that most present-day median earners (or actually people in general) probably don't have the saving ethic sufficiently to save that fast.

I don't think human beings work like that. As somebody said on the Ocado thread, almost nobody starts a business with a plan to make a profit in 12 to 15 years' time. People usually work to much shorter time horizons.

You might start saving, then after a few years of interest rates below inflation and seemingly endless HPI think to yourself 'why bother?' It's hard to stay motivated to save when the immediate reward (interest on savings) is nonexistent and the future reward (buying a house) seems to be getting ever further away.

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I don't think human beings work like that. As somebody said on the Ocado thread, almost nobody starts a business with a plan to make a profit in 12 to 15 years' time. People usually work to much shorter time horizons.

You might start saving, then after a few years of interest rates below inflation and seemingly endless HPI think to yourself 'why bother?' It's hard to stay motivated to save when the immediate reward (interest on savings) is nonexistent and the future reward (buying a house) seems to be getting ever further away.

Quite so. Although my approach was purely arithmetical, it was to hint at how unachievable this is for most ordinary folk in reality.

EDIT: Typo.

Edited by Ologhai Jones

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try renting..the marital bed is exactly the same, whoever owns the walls.

They said they wanted to start a family. It all depends how you feel about having to drag the marital bed, together with the kids' beds, and all the other household accoutrements, from one place to another every six months.

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They said they wanted to start a family. It all depends how you feel about having to drag the marital bed, together with the kids' beds, and all the other household accoutrements, from one place to another every six months.

I feel really sorry for these people dragging their family from hellish landlord to hellish landlord every 6 months.

It sounds like a nightmare. But like a nightmare, I also doubt if it's real, because it's so far away from anything I've experienced.

Maybe I've just been consistently fortunate. Which in my case would be a first!

Unobtrusive and reliable letting agents. Belting flat in the New Town of Edinburgh for half of the equivalent mortgage payment. Sizeable savings increasing every month.

I just can't see the downside to renting, other than psychological.

Take yesterday. I both renewed my lease and had a leak from my bath into the flat below. By far the most dramatic day I've ever had in a rented property. A plumber was despached promptly and the fault corrected that afternoon. All I had to do was make the guy a cuppa!

Sure, this was an easy fix but it's Incidents like this that serve to remind me what a pain maintainance could potentially be if I was the one carrying the can.

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Presumably the £37k is for the still currently ludicrous prices though, so once they've returned to a bit more like sensible levels you won't need as much. I've got approximately that but am faced with the car looking like it's going to fall apart fairly soon so will have to spend some of it :( I hate spending on anything more than about £5.

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More expensive houses 'cost more'

Higher house prices mean that houses now cost more to buy, the BBC has learned. Figures seen by the BBC reveal that a house with a price tag £50,000 higher will cost up to £50,000 more than it used to and maybe even higher than that once taxes and other charges are taken into account.

The news comes as a further blow to the housing market at a time when many hard working people are looking to lock-in their earnings.

"I'm shocked. How do they expect people to be able afford to buy my house if it will cost them that kind of money?" said Londoner Imber Seal

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Hard to part with £37K to a buy a flat, when you have saved so long...you really would expect something for your money and your future 25 years of payments.

you think...wow, im pretty secure, ive got £37K...then think...wow, i have no cushion whatsoever, and the flat is the same as the one im renting and Im STILL Paying out for it every month...AND Im liable for all the repairs, the maintenance fees and everything else.

Its a toughy.

But they can paint the walls ;)

Seriously, this would be the emotion I would have. I'm currently obsessively saving to take advantage of the impending crash, but when it comes to the point of handing over my life savings for four walls, I may decide to take a pass - especially if the savings interest ends up putting a dent in the rent.

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Seriously, this would be the emotion I would have.

Indeed

We're (potential) cash buyers, and I've got an extreme reluctance to hand over our savings to retrospectively fund the lifestyle of some MEW'd out fool.

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I feel really sorry for these people dragging their family from hellish landlord to hellish landlord every 6 months.

It sounds like a nightmare. But like a nightmare, I also doubt if it's real, because it's so far away from anything I've experienced.

Maybe I've just been consistently fortunate. Which in my case would be a first!

Unobtrusive and reliable letting agents. Belting flat in the New Town of Edinburgh for half of the equivalent mortgage payment. Sizeable savings increasing every month.

I just can't see the downside to renting, other than psychological.

Take yesterday. I both renewed my lease and had a leak from my bath into the flat below. By far the most dramatic day I've ever had in a rented property. A plumber was despached promptly and the fault corrected that afternoon. All I had to do was make the guy a cuppa!

Sure, this was an easy fix but it's Incidents like this that serve to remind me what a pain maintainance could potentially be if I was the one carrying the can.

Agree with this. Plus, say if you move once every three years or so, it gives you the motivation to clear out some crap. Rather than living in cloud cuckoo land, we have simply explained to our pre-school daughter that we don't own the house and might have to move one day. It's not rocket science.

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I don't think human beings work like that. As somebody said on the Ocado thread, almost nobody starts a business with a plan to make a profit in 12 to 15 years' time. People usually work to much shorter time horizons.

You might start saving, then after a few years of interest rates below inflation and seemingly endless HPI think to yourself 'why bother?' It's hard to stay motivated to save when the immediate reward (interest on savings) is nonexistent and the future reward (buying a house) seems to be getting ever further away.

How about saving just because saving makes sense - high HPI or low interest rates shouldn't be a disincentive. What about having money to pay the rent and buy food in the event of a lengthy period of unemployment? People expect the state to step in and take care of them and this has ruined the savings ethic. The only people who the govt should really have to help are those who genuinely earned too little to be able to save, or those who have run out of savings. How you design/enforce such a system is another question.

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Newsbeat? dont they realise the problem is that just not enough parents are dying leaving fortunes to their kids?

....they are not only living longer, they need the money to pay for the pensions they do not have and/or pay the long term medical bills they may have to pay in the future.

...anyway if they did manage to save £37k would buying a property today be the best advise to give your kids? :unsure:

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Hard to part with £37K to a buy a flat, when you have saved so long...you really would expect something for your money and your future 25 years of payments.

you think...wow, im pretty secure, ive got £37K...then think...wow, i have no cushion whatsoever, and the flat is the same as the one im renting and Im STILL Paying out for it every month...AND Im liable for all the repairs, the maintenance fees and everything else.

Its a toughy.

Correct and often the rent that you are paying is lower than the interest you will pay back to the bank. Better to continue to save and get a better deposit to buy once house price crash.

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  • 146 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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