Mortgages  

First-time buyers becoming more financially independent

First-time buyers becoming more financially independent

Almost half of first-time buyers bought a home without needing help to raise the deposit in 2014, according to analysis by the CML.

The rate of 48 per cent is an increase from 2011 when the CML last did this analysis, when the figure was 34 per cent.

According to the research, the number of first-time buyers helped with their deposit – either by their parents or grandparents – was greatest in London. In the capital only 35 per cent of first-time buyers had been able to raise a deposit without any help, while in the north the figure was nearly 60 per cent.

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The CML study said: “Affordability pressures remain elevated and, with the house price increases we saw in 2014, they are likely to have become a little more stretched once again.

“Despite the real income growth expected in the short term, the prospects for growth in lending to first-time buyers may be more limited in the period ahead without significant improvements in household finances or the further extension of government support.”

According to the CML’s analysis the average first-time buyer was 29 years old, with an income of £37,700 a year. Those who were unassisted were on average 31 years old, earning £42,000 a year.

Adviser view

David Hollingworth, director at Bath-based London and Country Mortgages, said: “This matches our experience in that still the majority are getting some help but there is obviously a sharp increase. That has to be down to the improved options for those with smaller deposits.”