At the end of each month thethriftdiaries.com looks at current money issues that are affecting students, graduates and the younger generation.
What is it?
47,185 mortgages were approved last month, compared to a typical total of nearer 80,000 in a stable market, according to Bank of England figures published this week.
Why?
In spite of the huge demand for mortgages especially amongst first-time buyers the much desired 90% mortgages are few and far between. Many lenders require a 20-25% deposit to get a mortgage meaning many first-time buyers have been frozen out of the market.
How will this affect me?
The mortgage market is likely to continue in this way for the next few years at least. Those who are wishing to buy in the next few years may have to go to their parents for help or else face coming up with a deposit ranging from £30,000 – £100,000 depending on the price of the property.
What can I do to help myself?
Start a savings account devoted to your deposit on a house. Even if you’re unsure about buying in the next 5 years it’s good to have something just in case you find yourself in a situation where you want to buy. You could always consider borrowing money off of your parents if you’ve found your dream house.
