People buying their first home in Bristol already need to save up an average of £24,000 to get on the property ladder – but that could soon go up by thousands more.
England’s housing market re-opened for business last week but first-time buyers may now face needing to raise around £12,000 more for their deposit. That’s because they may need to put down a 15 per cent deposit rather than 10 per cent, as many low-deposit mortgage deals have vanished.
Bristol is already one of the most expensive places in the country for first-time buyers, with the average 10 per cent deposit needed to get on the property ladder sitting at £24,069.
The only cities where the average 10 per cent deposit is higher are London (£47,757), Brighton (£30,960) and Reading (£24,713).
But analysis by Moneyfacts.co.uk shows the number of five and 10 per cent mortgage deals on the market now stands at just a fraction of the amount before the lockdown.
On Tuesday, May 19 there were just 30 deals available for those with a five per cent deposit – less than a tenth of the 387 deals available two months ago.
That means buyers in Bristol will face having to raise an additional £12,034 to put down a bigger deposit.
Rachel Springall, a finance expert at Moneyfacts.co.uk, said: “It is hoped that in time the higher loan-to-value deals will return, albeit slowly.”
She added: “First-time buyers who now feel their deposit doesn’t go as far as they had hoped may now need to wait a lot longer to get a step on the property ladder, or feel they have to approach the bank of mum and dad to boost their deposit and open the doors to more deals.
“Still, there may well be borrowers out there who will want to wait and see what the months ahead may bring and postpone their house-hunting until more higher loan-to-value deals return to the market.”
Rightmove said the typical price tag on a first-time buyer home in England is £241,891. This is two per cent higher than a year earlier.
This includes studios, flats and houses with two bedrooms or fewer.
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Rightmove’s commercial director Miles Shipside said: “Many first-time buyers looking to grab a bargain right now may find they’re disappointed, as on the whole, asking prices of all first-time buyer properties up for sale have been holding up.
“There will of course be some sellers who need to sell quickly and may be willing to negotiate on price so it’s worth asking your local agent if there’s any with this predicament if you do now need to lower your budget.
“However, where demand is outstripping supply and it’s an attractive property in a desirable location, then an offer closer to the asking price will have a better chance of being accepted.”
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He said buyers could try searching for recent sold prices of homes in the same area to gauge whether a property they are viewing may be over-priced and help give them confidence about how much they should be offering.
Average 10% and 15% deposits needed for typical first-time buyer properties according to Rightmove
– London, £47,757, £71,635
– Manchester, £16,778, £25,167
– Birmingham, £15,873, £23,809
– Bristol, £24,069, £36,103
– Liverpool, £11,225, £16,837
– Nottingham, £14,394, £21,590
– Bournemouth, £21,316, £31,974
– Newcastle-upon-Tyne, £12,723, £19,085
– Leeds, £13,899, £20,848
– Southampton, £17,452, £26,178
– Sheffield, £12,972, £19,458
– Plymouth, £14,306, £21,459
– Leicester, £15,062, £22,593
– Brighton, £30,960, £46,440
– Portsmouth, £17,843, £26,765
– Stoke-on-Trent, £10,080, £15,120
– Hull, £9,759, £14,638
– Bolton, £11,434, £17,151
– Reading, £24,713, £37,069
– Bradford, £8,995, £13,492
Here are the average 10% and 15% deposits needed across England’s regions, according to Rightmove:
– North West, £12,962, £19,444
– East Midlands, £14,926, £22,390
– Yorkshire and the Humber, £12,978, £19,467
– West Midlands, £15,099, £22,648
– South West, £20,254, £30,381
– London, £47,757, £71,635
– North East, £10,034, £15,051
– East of England, £22,939, £34,409
– South East, £25,035, £37,553