First-time buyers increasingly putting money in savings accounts for deposits

First-time buyers are increasingly putting money into savings accounts so that they can put a deposit on a house without having to borrow money.

According to Andy Pratt, chief operating officer at Alexander Hall, an independent mortgage advisor, first-time buyers have been instructed to start saving for deposits which they have done.

He said: "They have been actively doing that – tightening their belts and saving a little bit more, or seeking assistance from mum and dad in some instances as well, but primarily trying to save it up themselves.

"There has been quite a lot of evidence that people have paid off debt generally in households, but some people who have been renting have been putting into savings accounts to save up for their deposit."

Mr Pratt made these comments after Safe Home Income Plans revealed that first-time buyers now need to pay seven times more than their parents did to get on the property ladder.

People looking to put money into a savings account to put their deposit into may want to use a price comparison site, such as MoneyExpert.com, to find the best one for them.

Richard Marriott, head of savings at Nationwide, recently stated that Brits should try and save as much money as they possibly can, even if it is just £10 a month.

That is because saving a small amount each month can benefit consumers in the long-term as it can act as a financial safety net.

First-time buyers who want to save up for a deposit could consider putting money into an Individual Savings Account (ISA).

ISAs can be taken out with a bank or building society and a maximum of £5,100 can be invested into them each financial year if someone has both a stocks and shares and cash ISA.

The main benefit of this saving account is that the interest is tax-free, meaning that people can get the most for their money.
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