Several reports are saying that first-time home buyers are intimidated by upfront fees.
According to Mirror, the number of first-time home buyers has significantly decreased in 2015. It is the first time in four years that the number has plunged after the deposit had been raised many folds over the typical amount of £30,000. Sources say that in London, the average first-time buyer needs to prepare £90,000 deposit money. Based on a research from Halifax, a banking institution, around 310,000 people took the first step to owning a home, but it is 0.5 percent down from the 311,700 who did the same in 2014.
According to the report from Halifax, the decline in number of first-time buyers is connected to the lack of supply of homes to choose from. In another news, the lack of supply of homes drives prices upwards thus, the increase in deposit required.
As per Daily Mail, the average deposit required from first-time buyers has gone up to as high as 88 percent from £17,499 in 2007 to £32,927. With regards to average home prices, the increase was as high as 10 percent with the average price of from £172,563 rising to £190,180. Average home prices in Greater London have risen to astounding heights at £367,990, which reportedly is £125,000 higher than the next pricey region. This is the reason that the average deposit required in Greater London is as high as £90,000, just as Mirror has also reported.
Managing director of the NAEA, Mark Hayward, said that it is normal at this time of the year that that demand is high and supply is low, but the higher prices due to lack of supply is beyond seasonality. Hayward said, "It's clear that we're faced with a crisis here: the housing market needs addressing as a matter of urgency."