A typical private renter would need almost 21 months to save the £26,409 required for a first home, even if they could put aside all of their income left after tax and rent, according to analysis from Konnect You.
The study calculated the upfront cost of buying based on the average UK first-time buyer property price, a 10% deposit and a range of purchase and moving expenses.
It found that a buyer would need around £26,400 before making their first mortgage payment, with the deposit accounting for £22,800 of the total.
Other costs in the calculation include £1,624 for conveyancing, £509 for a survey, £354 for a valuation, £1,080 for removals and £42 for postal redirection, bringing the overall requirement to £26,409.
RENTERS LEFT WITH £1,268 UNDER SAVINGS MODEL
Konnect You based its analysis on a single full-time worker earning a typical salary, providing estimated take-home pay of £2,636 a month after income tax and National Insurance.
After deducting average UK private rent of £1,368 a month, the model leaves £1,268 available to save. At that rate, reaching the £26,409 target would take 20.8 months.
However, the calculation excludes food, household bills, transport, childcare and other everyday spending. The company said the figure should therefore be regarded as a theoretical minimum rather than an indication of how long most households would actually need to save.
LONDON SAVING PERIOD EXCEEDS SIX YEARS
The analysis found substantial regional differences in the amount first-time buyers would need to accumulate.
London had the highest upfront requirement at £59,689. With an average monthly rent of £2,268, the model produced a minimum saving period of 73.7 months, or 6.1 years.
In the South East, buyers would require £33,554 and face a minimum saving period of 24.2 months, while the figure was 21.3 months in the East of England and 21.5 months in the South West.
The East Midlands and West Midlands recorded minimum saving periods of 15.6 and 15.7 months respectively.
Wales and Yorkshire & Humber both stood at 13.4 months, compared with 14 months in the North West.
The shortest periods were recorded in the North East, where the £18,076 upfront requirement equated to 11.1 months, and Scotland, where £19,275 would take 11.6 months to accumulate under the model.
HOMEBUYING REFORMS WOULD REDUCE COSTS
The government has said planned reforms to the homebuying process could save first-time buyers an average of £650 per transaction.
Konnect You calculated that this would represent around 2.5% of the typical £26,409 upfront requirement.
Dave Sayce, founder and managing director of Konnect You, said: “The national figure gives a useful indication of the scale of the upfront challenge facing first-time buyers, but the regional differences are particularly interesting. A theoretical minimum saving period of around 21 months nationally ranges from just over 11 months in the North East to more than 6 years in London.
“These figures also show why looking only at the house price can miss part of the picture. First-time buyers need to find the deposit alongside the costs of completing and moving into the property, while renters are trying to build that cash at the same time as paying for their accommodation.
“The Government’s proposed £650 saving is welcome, but it represents just 2.5% of the typical upfront requirement. The data shows that there remains a significant amount for first-time buyers to find before they make their first mortgage payment.”
