First time buyers are struggling to save a deposit

Nationwide research shows that due to low interest rates, house prices and interest payments on mortgages are affordable for many, but mortgage providers are demanding too great a deposit or will not lend enough money.

Fionnuala Earley, Nationwide’s group economist, explained: “For many true, and particularly young, first-time buyers, the deposit and income multiple constraints are too strong and prevent them entering home ownership at all.

“This is even before considering other calls on their income such as student debts.”

These student debts, coupled with additional consumer debt accumulated on credit cards and personal loans, mean that deposits are even harder to bring together.

Mortgage providers offer products that are, on average, 3.1 times the size of the borrower’s earning, meaning that an average wage earner could borrow £85,250, which still requires a deposit of almost £47,000.