Prospective first time buyers to step up their savings during 2009
According to Abbey Savings, practically two fifths of soon-to-be first time buyers are increasing the rate at which they save towards a deposit this year.
Of those that have already commenced saving, 38 percent said that they are intending to do so at a more rapid pace during the course of 2009. In addition, 40 percent of those that had not already commenced saving said that they are looking to rectify this over the coming year.
As house prices continue to tumble, those with an existing deposit said that they are planning to save an average £203 more per month this year in a concerted effort to mount the property ladder. Those that are intending to begin saving this year said that they are intending to save an average £123 per month.
The results of the research also showed that the average first time buyer is aiming for a deposit of £20,000. However, regional differences are apparent with Londoners being under the impression that they will need £26,641, which makes London the area with the most substantial savings target. In contrast, inhabitants of the Midlands are looking to build an average deposit of just £13,635.
While 38 percent of respondents said that they are intending to build up their deposit this year, 15 percent of those that already possess a nest egg for this purpose have said that they are not intending to put aside as much this year as they have done previously. On average this group look set to save £74 less each month.
Director of Savings and Investments at Abbey, Reza Attar-Zadeh, commented: “Homeownership is beginning to look like a much more realistic goal for thousands of first time buyers who have clearly been keeping an eye on house prices. Building a deposit is no small task, but those who have chosen to start putting extra money away are clearly better prepared to make an offer on a property when they see their opportunity. Savers need to be aware that a large deposit will make it easier for them to be accepted for the best mortgage deal. Abbey’s First Home Saver has been specifically designed to help savers build up a reasonably size deposit, allowing you to put money away regularly up to a sum of £50,000″
First time buyers who are looking to create their dream property, once they have moved in, could consider the option of taking out a secured loan to fund the home improvements.
A secured loan could be used to finance a range of projects such as fitting a new kitchen or bathroom. Larger scale projects including extensions, loft conversions and conservatories could also be funded with a secured loan.
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