Renters will take decades to save for a home deposit
Buying a home is becoming increasingly out of reach for many renters, suggests new research from Scottish Widows which says that since the average private renter saved £2,180 in the last year, it would therefore take 23 years to accumulate the average deposit (which they estimate at £50,845).
Even the average deposit for a first time buyer – at just under £28,000 – would take almost 13 years.
The survey of more than 5,000 UK adults also indicates that many renters are giving up on property ownership as only 29% say they are actively saving to put down a deposit on a home.
According to the report, when renters have managed to put money aside they have, on average, less than half the amount (£12,142 vs £29,382) saved by those who are not paying private sector rents. Those who rent privately are 50% more likely than the average to have no savings at all (25% vs 17%).
“We live in a society where many strive to own their own homes,” said Iain McGowan, Head of Savings and Investments at Scottish Widows, “but for many people facing high rent and increasing living costs this isn’t going to be achievable. Whilst this is concerning, what is most worrying is that over a third of renters have no savings at all and are leaving themselves vulnerable in the short and long terms.
“The importance of saving goes much further than getting on the property ladder as a healthy savings pot can provide an invaluable buffer for the unexpected or tough times. Whilst owning a property is seen for many as something to work towards, we need to ensure that people are able to manage their outgoings, whether rent or a mortgage, and create that safety-net for unexpected bumps in the road.”renting
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