"The help of family in building a deposit continues to play an important role, especially for first time buyers."
Those planning to purchase in the East Midlands and the North East of England/Yorkshire & the Humber were found to be the most optimistic that they will find a home within the year, while those planning to buy in East England and London have the lowest levels of optimism.
Both prospective and recent home buyers reported taking significant steps to effectively manage their finances to enable them to purchase their new property. Almost half (45%) said they cut back on social spending, 35% reduced the number of holidays they went on and almost three in ten (28%) took steps to reduce their shopping bills, while almost 1 in 10 (9%) delayed having children to be able to afford their new property.
Home buyers continue to manage their finances carefully once they have purchased their property, with around a third (33%) continuing to reduce social spending, and around a quarter (26%) continuing to reduce the number of holidays they went on.
The research also revealed that over a third (34%) of recent home buyers admitted that they had no savings left after they bought their new home, with almost half (43%) receiving help from family in order to fund their house purchase, borrowing an average of almost £30,000. Despite this, however, four in ten (43%) home buyers report feeling confident about their financial situation over the coming year.
David McCreadie, Managing Director at Tesco Bank, said: “We want to do all we can to help customers at every stage of their lives, and we recognise that buying a property is likely to be the most important and expensive purchase customers will ever make. This research identifies the significant financial and personal sacrifices people are making in order to buy their new home, and our aim is to help our customers during this process by providing some of the most competitive mortgage products on the market, as well as offering Clubcard points on their mortgage repayments as an extra little help.”
David Hollingworth, Associate Director Communications, London & Country Mortgages, added: “The research underlines some of the challenges in saving for the purchase of a new home and the help of family in building a deposit continues to play an important role, especially for first time buyers. Although many home buyers clearly cut back on their spending elsewhere in order to budget sensibly, they can at least put some certainty into their mortgage payments by taking advantage of the very attractive fixed rate options currently on offer. We continue to see the majority of customers elect to fix their rate, so they know exactly where they stand when it comes to the mortgage, which is likely to be the biggest single monthly outgoing.”
