The cost-of-living crisis is hitting homebuying dreams

Nearly two-thirds of would-be first-time buyers have had to cut down their regular savings due to the cost of living crisis, according to research by Aldermore Bank. As the cost-of-living crisis takes its toll on incomes and savings, 72% of prospective first-time buyers say their attempts to purchase a property have been impacted. A third (32%) of would-be homeowners have put their property purchases on hold, anticipating delays of around 20 months. On average, prospective first-time buyers plan to save £43,500 for a deposit, according to the bank's first-time buyer index. Nearly two-thirds (64%) have had to scale back their regular savings, likely increasing the time it takes them to get on the property ladder. And while savings plans are being put on hold, mortgage rates are climbing, following a string of Bank of England base rate hikes. The average five-year fixed mortgage rate on offer for a borrower with a deposit as low as 5% was 4.49% at the end of August, according to Moneyfacts. Back in early February it was 3.35%. 

The Independent (10/09/2022)