UK mortgage deposit at its lowest level for 6 years

UK mortgage deposit at its lowest level for 6 years

Despite the fact house prices continue to rise nationwide, it's apparently actually getting cheaper for people to purchase a home, with a new study showing that the amount of money Brits need for a mortgage deposit is falling. 

Raising a deposit has been the biggest barrier to ownership in the property market now for over five years, but according to the Building Societies Association's (BSA) Property Tracker report, this could be less of an issue than it has been in some time, with the average deposit needed now at its lowest level for six years. 

The BSA says that results indicate that people are feeling reasonably confident about home ownership prospects for themselves as the cost of paying a deposit falls. 

In the December quarter, the BSA said that the cost of a mortgage deposit was a barrier to ownership for as many as 52 per cent of people across the UK who were looking to get onto the property ladder. However, this represented a significant fall from the 59 per cent who said the same at the end of the September quarter, suggesting it is getting far easier to save for a deposit. 

Compared to the all-time high of 69 per cent recorded in September 2011, it can also be seen just how much deposits as a barrier have improved in the last few years. 

Other barriers to ownership that have improved in the latest three month survey included access to mortgage finance, which dropped from 41 per cent to 38 per cent, the affordability of monthly repayments, which dropped from 35 per cent to 33 per cent and lack of job security, dropping to 26 per cent from 28 per cent three months ago. 

"This snapshot of sentiment in the housing market shows that consumers are feeling reasonably optimistic about getting on or moving up the property ladder," said Paul Broadhead, BSA head of Mortgage Policy.
"Now is the time to focus on building more homes, supported by appropriate investment in infrastructure, in order to begin to address the long term imbalance of housing supply with demand," he added.