And numbers of younger first-time buyers able to buy a home without help with a deposit fell by 100,000 per year between 2006 and 2009.
The UK Housing Review published by the Chartered Institute of Housing (CIH) has been collating and analysing UK housing market data for nearly twenty years, tracking market trends over decades. The new edition, published on 21 January, highlights the jump in the size of deposit needed to get on the housing ladder. First-time buyers needed a 30 per cent deposit on average in 2009 in order to purchase a home, higher than at any time since 1970. According to co-author Professor Steve Wilcox this makes the collapse in the availability of low-deposit mortgages the largest single barrier to home ownership.
Richard Capie, CIH Deputy Chief Executive, said: “Deposits are now at a 40 year high and prospects for first time buyers look bleak. The deposit barrier has become a mountain that more and more potential home owners simply can’t climb without help from mum and dad. While we don’t want to return to the days of 110% mortgages and irresponsible lending, it is clear that the pendulum has swung too far in the other direction. This report shows that more work needs to be done to set out new rules which will enable responsible lending to households who can afford to sustain a mortgage. It also shows that we need to make sure that other tenures, such as the private rented sector, provide a better alternative for the increasing numbers of people who will simply be unable to buy a home in future.”
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