It’s still cheaper to buy a house than rent – but half of under-35s need to find a partner before they can afford to do it
Londoners could save up to nearly £2,000 a year by buying instead of renting
YOUNG people could save up more than £600 every year by buying their own home instead of renting, new research has found.
Data from Halifax, the UK's biggest mortgage lender, shows that first-time buyers in the UK would be on average £651 a year better off, if they bought their own home instead of renting.
And Londoners could save up even more, cashing in almost £2,000 a year by stepping on the property ladder instead of paying rent.
People living in the Scotland and South West would also be saving £869 and £969 respectively by becoming homeowners.
But despite the massive savings, 45 per cent of people aged between 18 to 35-years-old are waiting until they have a partner to share the costs before they can buy.
A lack of income was seen as the biggest barrier for young people, with 55 per cent of men blaming their salaries, compared with 70 per cent of women.
Martin Ellis, Halifax housing economist, blamed the whopping average deposit of £32,899 for people's decision to wait before they buy.
“With many people trying to fund day to day living while saving for a deposit for a first home may not even be able to imagine raising this amount of cash on top of all their regular outgoings,” he said.
Tips for first-time buyers who want to get on the property ladder
THINKING of buying your own home? These tips may help...
- Identify the more affordable areas of the city or region you want to move to, by looking where property prices are much lower than the city or region's average.
- Consider avoiding areas that have experienced particularly high house price growth in recent years, as that may suggest potential for future growth has been already exhausted and prices will not grow much going forward.
- Look into whether there are any transformation projects or infrastructural developments planned. These could signal a potential increase in house prices.
- Look at the crime rates in the area to understand the severity of the crime and whether the picture is improving or worsening.
- Find out if there are any developments planned for schools in the local areas. Improvement in the education offering in affordable areas can push house prices up.
“Getting to grips with the property market jargon, calculating what’s affordable and understanding borrowing options available will help bring people looking to own their own home closer to the first step,” he added.
But it's not just the deposit that is the problem.
Buying a house on your own means you need to have the income to secure a mortgage.
Lenders typically only allow customers to borrow up to four times their income.
First-time buyers have been forced to consider new ways of getting onto the property ladder in recent years, with nearly one in four of them say it took them between five and ten years to save up enough for a house deposit.
According to Halifax, Londoners buying for the first time are putting down an eye-watering average deposit of £106,577 compared to just £16,457 in Northern Ireland.
Nearly half of first-time buyers now rely on cash from their parents to help them become homeowners - an alarming trend in Britain’s spiralling housing crisis.
HIDDEN GEMS Most affordable cities for first-time buyers revealed – but would you move hundreds of miles just to buy a home?
The Sun Online has previously explained how you can bag a bargain, if you’re prepared to bid for a property at auction.
We’ve also reported on the most affordable cities for first-time buyers with Southampton, Norwich and Nottingham topping the list – while those searching in Brighton and London may struggle.
More stories about the housing market and where to buy
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