A new survey from The Nottingham Building Society has found that 63% of potential first-time-buyers plan to sell one or more valuable items such as jewellery to help scrape together their deposit - 14% expect to raise more than half of the funds they need this way.
The survey found that 62% are relying on an inheritance pay-out, with 21% expecting a fifth or more of the funds they need to come from this source.
The society also revealed that The Bank of Mum and Dad is still very much alive. A massive 81% of would be first-time buyers are expecting some of the funds to come from here. 22% anticipate they will secure more than 50% of their deposits from their parents. The corresponding figures for the parents of their partners is 68% and 10%, and almost half (49%) relying on grandparents also.
Other sources of funding are expected to include loans from friends, which 50% of would be first-time-buyers plan to use. In addition to this, loans from family members other than their parents or grandparents were something that 48% of those planning to buy their first home intend to utilise.
Nearly all (95%) will use their cash savings, and 60% will use stock market investments.
However, The Nottingham’s research reveals that many first-time-buyers could be far more savvy when saving for their first homes as they’re missing out on hefty bonuses that are available via government-backed accounts such as Help to Buy ISA and Lifetime ISA. 40% have no intention of using a Lifetime ISA that can offer bonuses of up to £1000 a year. This number reduced to roughly a quarter (21%) of savers missing out but not planning to take advantage of Help to Buy ISA.
Tina Hayton-Banks, Director of Member Services for The Nottingham, commented; “We know saving for a deposit is no mean feat for first-time buyers and our research echoes what we hear all the time across our branch network, people are exploring every available route to get on the ladder. It’s a shame there’s still a relatively low awareness of products that can help them get there faster, such as the Lifetime ISA, but it’s an account we’re proud to be offering to support first-time buyers and expect to see its popularity grow and grow.”