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Saving for a deposit could take up to eight years

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Research from Yorkshire Building Society has investigated how long it could take to save a deposit for a property.

Compared to five years ago buying a property is becoming increasingly difficult with a strict process of application and a strong deposit needed.

Yorkshire Building Society has reported that a potential homeowner looking to buy a property saves £248 a month for a deposit on an average priced property which costs £131,250. If a 20% deposit is needed by lenders asking for this it could take up eight years to save.

The region an aspiring homeowner is situated in can also affect the amount that needs to be saved for a property. For the North East Yorkshire and the North West area £15,000 would be needed for a deposit compared to the South East which would need a deposit of £30,000, highlighting that it could take much longer to save living in the South East. London was the highest area needing £60,000 to be saved for a deposit.

The research also revealed how a deposit was being saved up. 60% of the people asked said they set up a regular savings account, 7% turned to their parents for help and 4% used their inheritance.

Despite the problems prospective buyers are being faced with, the housing market is showing signs of improvement since the £80billion funding for lending scheme set up by the Bank of England and the Treasury.

Chris Smith at Yorkshire Building Society, said: “In the last five years mortgage activity in general has more than halved, and today’s first time buyers are facing a squeeze on incomes and pay rates that are not keeping pace with inflation.

“However, it’s encouraging to see the proportion of first time buyers has actually begun to increase in this period and more people are seeing home purchase as a prudent financial decision.”

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By Amanda Bainbridge