BANK ACCOUNTS

Housing deposits rise tenfold while Brits’ income only doubles

Buying a house is a difficult challenge in the UK these days. Latest data reveals that while the costs of properties and deposits have increased tenfold in the last 20 years, household income has only doubled.

According to new research from first direct, the average housing deposit was £6,793 on average in 1990, whereas the average in 2011 is £65,924. On top of this, house prices have also risen in the same period by a factor of 4.3 in the last two decades.

This increase in house prices and the reduction in the amount of mortgage lending by many banks and building societies is forcing British first time buyers to pay up to 9.7 times more in their deposit than 20 years ago.

Despite this tenfold rise, research shows that Brits haven’t experienced a proportional increase in their income, with average household income having risen by just 2.5 times in the same period.

Additionally, figures also found that 2010 was the most difficult year to buy a house in the past twenty years. That year, the average house prices exceed 6.3 times the average household income, with the average deposit set at 1.7 times the average income.

Helping First Time Buyers

A number of banks and building societies have realised this tough situation and have launched new deals for first time buyers.

Halifax and CreditExpert from Experian launched recently a new partnership designed to increase the chances of First Time Buyers (FTB) buying a house.

With this new service Halifax applicants who don’t get approved for a mortgage because of their credit score will have access to a bespoke CreditExpert membership.

This will give them unlimited access to a team of fifteen credit experts that will help them to analyse their financial situation and turn the situation around so they can aim to buy their first house.

Comparing bank accounts is advisable if you want to obtain the maxim benefit of the money invested in your first house.

Tags: BANK ACCOUNTS, compare bank accounts, cost of living, first time buyers, mortgage