Determined first-time buyers are cutting back on going out and energy usage to still be able to save up for a mortgage deposit, research claims.
A survey by Rightmove has aimed to identify the most common items first-time buyers are reducing their spending on in order to save for a mortgage deposit, and there is not an avocado in sight.
The study found that on average, it is taking a first-time buyer five years to save up their deposit.
Despite affordability concerns from rising interest rates and mortgage pricing, Rightmove said would-be first-time buyers are making lifestyle changes to be able to save more of their income towards a deposit on a first home.
Almost three quarters of respondents said they would reduce spending on going out, 55% would use less gas and electricity at home and 49% would have cheaper holidays.
Half said they would cut the amount they spend on their weekly food shop and 35% would cancel subscription services such as Netflix and Amazon Prime.
The survey also looked at what is most important to buyers when purchasing their first home.
A three-bedroom semi-detached house is the most popular property type that first-time buyers are hoping to buy outside of London, while London first-time buyers have their sights set on a two-bedroom flat.
Though first-time buyers and more experienced buyers value similar features in a home, first-time buyers placed more emphasis on energy costs, a spare room and space to work from home.
Experienced buyers prioritised a garden more than first-time buyers, as well as a parking space and garage.
Rightmove said demand in the first-time buyer sector is down 26% compared with the frenetic market of last year.
That is still three-quarters of last year’s level and 4% higher than 2019, the portal said.
Tim Bannister, Rightmove’s property expert, said: “The sudden nature of mortgage interest rate increases has meant that first-time buyers have had to very quickly reassess their position. For example, those who already had a mortgage offer in place are trying to rush through their purchase to keep their lower rate.
“Many of those who had not yet secured an offer and found that the monthly repayments they would pay on a mortgage were a lot more expensive than planned, either had to budget for the extra costs, look for a cheaper property and borrow less, or pause their plans altogether.
“Now that mortgage rates have started to settle down, first-time buyers will be hoping that there are no surprises in today’s Autumn budget, and they can begin to get some longer-term assurance and financial certainty after what has been a turbulent and very uncertain two months.”
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