Deposit target 'rising faster than savings pot'
Many aspiring buyers in England fall further behind their depositsavings target every month due to a double whammy of soaring rent and house prices, new figures show.
Around two thirds of tenants (64%) wanting to buy a home can only afford to save a maximum of £50 a month as sky-high rents bite a huge chunk out of their income, according to homeless charity Shelter.
Meanwhile, the price of a typical first-time buyer home in England has jumped £583 a month over the last year, the latest Government data showed.
For someone hoping to save up a 10% deposit, the lowest amount a number of lenders will consider for new applicants, it means their final savings target has risen around £58 a month – more than they are able to save.
However, research from consumer site Which? shows the average first-time buyer actually puts down a 17% deposit. At this size their savings target would increase by £99 a month.
This leaves many falling further behind their final savings target each month unless the interest they earn on their pot can bridge the gap.
With house prices predicted to rise further, along with rents, Shelter chief executive Campbell Robb believes many families have little hope of buying a home.
"'Generation rent' are not going to become 'generation buy' any time soon," he said.
"Behind these figures are millions of young people and families on ordinary incomes who are struggling to cope with sky-high housing costs and the instability of private renting."
