The housing market is always rising in general and due to this fact, it is becoming increasingly harder for the younger generation to buy property of their own. The rental market is huge and is also booming as people simply cannot afford to buy.
Wages are not going up in accordance with the cost of living which also makes it harder for those to save for a property as just things like food and going out occasionally is so expensive, particularly for those wanting to live in London.
All these things that cost money are sometimes just needed in life and is sometimes hard to always just keep on saving, we all need to let our hair down every now and then! Therefore it just becomes harder and harder for the young generation of today to save enough money to buy a property, especially if they do have to rent.
For example a good incentive that is available at the moment is for new builds and all you need is a 5% deposit, rather than the usual recommended deposit of around 10% plus. The government will then lend you 20% of the purchase price, meaning you only need to get a mortgage of 75%. The loan of 20% is also interest free for the first five years. You can pay the loan back whenever you like if want to pay it back early etc. but obviously has the usual 25 years as a mortgage does. This is a great way for one person to try and get onto the property ladder if they cannot raise a large amount for a deposit. A help for the first time buyer and a help for the developers of new builds! Win, Win!
The other way is to try and save the deposit yourself then not owing the government a loan of 20% back as well as a mortgage. There are numerous ways to do this as we have discussed previously. The main one being if you are able to go back home and live with your parents for as long as you can for as little as you can, you are going to be able to save quite a lot towards a deposit of your own. If this is not possible and you are renting a place at the moment, maybe think about where you are renting…do you need this place for yourself? Could you save a considerable amount by just sharing a house or flat with some other people and then the rent you would be saving, keep the difference aside towards your deposit?
We have mentioned the option of selling things you no longer require on sites such as eBay, where you will be surprised what people want that you no longer have any use for. Clothing is a great seller as well as electronic games etc. Have a good clear out (maybe when you are going to move from rental accommodation) and see what you no longer really need and sell the items.
We hope this website has given you some useful information as well as some handy tips in how to save a deposit for a property and how you can use Back Zac to help you find the right mortgage for you. Contact us via the contact us form and we will get back to you with any queries you may have or alternatively, get started now with a property search and we will contact you with a selection of properties that we think will be suitable for you and take it from there!