31 Jul 2014
The Mortgage Advisory Bureau (MAB) has said the average deposit made by first-time buyers through the Government’s Help to Buy scheme has fallen to £8,527.
This is down from an average of £11,438 in April this year. Deposits made without Help to Buy have increased for the fourth consecutive month to £71,474.
Head of lending at the MAB, Brian Murphy, said: ‘Saving for a deposit has become quite difficult, especially if people are renting. With the right checks and balances in place, this kind of activity is an important part of a healthy mortgage market that can satisfy consumer needs without compromising on standards’.
This news came as the Bank of England revealed that mortgage approvals in general were up this year. The number of new approvals this year to June was 108,857 – an increase of 4% on the same period last year, which saw 104,678 approvals.
LSL Property services have also recently released figures showing that the number of first-time buyers is up 27% year-on-year in the first six months of 2014.
The MAB warns that lower deposits mean more interest will be paid over time, which could put buyers in a difficult position should house prices fall.