Four in five first-time buyers have moved back in with their parents to save for a deposit, according to new research by TSB, underlining the growing reliance on family support as affordability pressures continue to weigh on young buyers.
The survey of more than 1,000 first-time buyers who purchased a home in the past year found that compromise and location are central to getting on the housing ladder.
Three quarters (75%) of new homeowners opted for a smaller home, fewer bedrooms or reduced outdoor space in order to buy in their preferred area.
Just over a fifth (22%) said they had bought their dream home, while almost two fifths (38%) admitted to making compromises, and 9% said they had prioritised affordability and location over other factors.
FINANCIAL ASSISTANCE
Nearly all respondents (96%) reported receiving financial assistance with their deposit. Two thirds (68%) received support from family members, and 57% from friends – a trend the bank sees growing among younger buyers.
To meet their deposit targets, 38% said they had delayed major purchases, while 37% limited socialising or took on a second job.
On average, buyers saved for nearly three years (2.95), with the longest saving period in Wales (3.39 years) and the shortest in the East Midlands (2.56 years). Prior to purchasing, the average monthly rent paid was £960.
FINANCIALLY SECURE
Post-purchase, 45% of buyers reported feeling more financially secure, and 39% expressed a sense of relief. TSB customer data shows that the average mortgage term for first-time buyers has fallen slightly to 31 years, from 32 in 2024.
The average deposit size across the UK now stands at 18.9%, rising to 23% in London and dropping to 13% in Wales.
The typical age of a first-time buyer has also risen to 32, with the oldest in London (34), the South East and East Midlands (both 33), and the youngest in Yorkshire & The Humber (30).
COMPROMISE IS KEY
Craig Calder, Director of Secured Lending at TSB, says: “It’s clear that compromise is key to getting on the housing ladder in a preferred location – with most first-time buyers forgoing a dream home but feeling relieved, and more financially secure having made the move.
“Many made sacrifices to meet their deposit targets – such as moving in with parents, and taking a second job. To secure the best deal for your housing and affordability needs, do speak with a broker, or your bank.”
GROWING TREND
Mary-Lou Press, NAEA Propertymark President, says: “This has been a growing trend for some time, indicating how expensive it is for first-time buyers to get onto the housing ladder, so much so that they have to make enormous sacrifices and/or depend upon financial help from their relatives just to purchase a property.
“What is needed to make housing more affordable is targeted help, and we are seeing many financial institutions take a lead here with flexible mortgage products, as well as a sustainable supply of new homes that will stabilise supply and demand levels, which can hopefully be achieved by the UK Government and the devolved administrations meeting their individual housing targets.”
