People trying to get on the property market are going to find it even harder to buy a home as the average deposit for first-time buyers is now £57,000 in the UK.
That figure is up £10,000 in a year, according to new research from Halifax.
The bank found the average amount put down in 2020 was £57,278, compared with £46,449 the year before.
The highest deposit was (unsurprisingly) in London, where the average rose from £110,145 to £130,357 in 2020.
The biggest change was in Wales, where the average went from £26,029 to £32,663, an increase of 25%.
Despite many feeling priced out of the market particularly with low-deposit mortgages being pulled last year, first-time buyers still made up 50% of home purchase loans.
Halifax estimates this is down very slightly from 51% in 2019.
The overall number of first-time buyers in 2020 was down by more than 46,000, or 13%, compared with 2019, with an estimated 304,657 first-time buyers in 2020.
This was the lowest number since 2015, when there were 298,080 first-time buyers.
It’s been an unusual year for the property market as a temporary stamp duty holiday and an increased demand following the initial closure of the market in March during the first lockdown, saw prices soar for all buyers.
According to Office for National Statistics (ONS) figures, average UK house prices jumped to a record high of £250,000 in November and those in London broke through the £500,000 barrier for the first time.
Russell Galley, managing director, Halifax, said: ‘Whilst these figures confirm the almost inevitable fall in the overall number of first-time buyers in 2020 – with the entire housing market effectively shuttered during the first national lockdown – they also underline just how strong the bounceback was in the second half of the year.
‘Despite the obvious challenges presented by soaring house prices, not least the need to raise an even bigger deposit, first-time buyers still accounted for half of all home purchases, a reassuring statistic given their overall importance to the market.’
But Russell warned that they don’t expect house price rises to continue as we start to see the full economic impact of coronavirus.
He added: ‘With the economic impact of the pandemic likely to be felt most keenly by the young and those in lower-paid jobs, the need to prioritise improved housing availability and affordability for all those looking to make that first step on to the property ladder becomes ever greater.’
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These are the average deposit amounts across the UK for 2019 and 2020:
North East
2019 – £23,788
2020 – £29,563
Increased by – 24%, £5,775
Yorkshire and the Humber
2019 – £28,008
2020 – £33,313
Increased by – 19%, £5,305
North West
2019 – £29,519,
2020 – £34,347,
Increased by – 16%, £4,829
East Midlands
2019 – £33,268
2020 – £39,052
Increased by – 17%, £5,783
West Midlands
2019 – £34,008
2020 – £42,062
Increased by – 24%, £8,054
East Anglia
2019 – £43,474
2020 – £51,126
Increased by – 18%, £7,652
Wales
2019 – £26,029
2020 – £32,663
Increased by – 25%, £6,634
South West
2019 – £42,504
2020 – £51,397
Increased by – 21%, £8,893
South East
2019 – £54,654
2020 – £64,910
Increased by – 19%, £10,256
London
2019 – £110,145
2020 – £130,357
Increased by – 18%, £20,211
Northern Ireland
2019 – £25,327
2020 – £29,523
Increased by – 17%, £4,196
Scotland
2019 – £30,101
2020 – £35,745
Increased by – 19%, £5,644
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