From Second Jobs to Staying in, How First-Time Buyers Save for a Deposit

It takes the average first-time buyer four years to save for a deposit, according to new research, with nights out, holidays and new clothes among the luxuries they are prepared to give up to pull together the cash.

The number of first-time buyers reached 410,000 last year, with the average deposit just under £54,000. According to the research, from money app Ziglu, it took most people four years to save for their deposit, though 22% of respondents saved for more than five years, with half saying they almost gave up.

“First-time buyers have never had it so tough as rising house prices make it harder and harder to raise the money for a deposit. At the same time low interest rates make it harder to earn any return on cash savings which despite government support such as Lifetime ISAs add to the pressure and leave people waiting for four years to raise the money they need.”

Mark Hipperson, CEO of Ziglu

While 72% used saving accounts to accumulate their cash, one in ten said they had invested in the stock market with 13% admitting to buying cryptocurrencies to help them save.

According to the survey, not going out – at 56% – was the most popular way of building up savings. It was followed by cutting back on holidays (41%) and spending less on clothes at 40%. For 29% of people, finding extra part-time work helped, and 19% said they had sold possessions.

A lucky 28% of first-time buyers received help to secure their deposit from their parents, with grandparents chipping in for another 11%.

Read more about this story in City Am.