By Adam Male, Co-founder of Urban.co.uk, the online estate agent.
With the average property in the UK costing £206,145 and with the average deposit equating to 17%, it comes as no surprise that more and more people are struggling to take their first steps onto the property ladder.
Coupled with ONS reporting median gross annual earnings of £27,600 within the UK, saving a deposit for a house is no mean feat. Even if a first time buyer was earning £27,600 a year and able to save 10% of their wage each annually, they would be looking at 12.7 years of saving.
But cutting luxuries, such as daily coffees and online subscriptions can really make a difference! Here are some clever ways that first time buyers can give their savings a boost and get on the property ladder faster:
1. Cash in on your cappuccino
With the average UK worker spending a substantial £608.84 per year on daily take-away coffee, it seems that a coffee cutback could speed up the process. If Brits were to brew their own, this money could go towards their dream home, rather than milky foam!
Potential annual saving: £608.84
2. Set menu savings
Brits have developed a taste for meals out, chomping their way through £4,100 worth of restaurant meals per year. Cutting back on this luxury could help keep waistlines trim and bank balances bulging, as well as contributing towards that all-important deposit.
Potential annual saving: £4,100
3. Box-set bargain
Whilst staying in could be considered a cheaper option than going out, research reveals that it can be just as expensive to have a night in on the sofa. With Sky, a TV, phone and Internet package can cost the average household £592.80, with an additional £71.88 on Netflix, £119.88 for Spotify and £79 for Amazon Prime, each year - and that's without a TV license.
Potential annual saving: £863.56
4. Budget-busting beach breaks
Saving for a deposit can be hard work, which is why many Brits treat themselves to some well-deserved rest and relaxation on holiday. However, with the average family spending a hefty £2,328 on a sunny summer break, other cheaper means of relaxation could be considered.
Potential annual saving: £2,328
5. Work-out your finances
It comes as no surprise that one of the UK's favourite ways to splash the cash is on gym membership. With thousands of gyms in the UK offering weighty monthly packages, first time buyers could be looking at spending up to £1,092 per year on keeping fit.
Potential annual saving: £1,092
6. Rev up your revenue
There's no doubt that a car is a necessity for many, however, if it is not used very often there is a big potential saving to be made. A vehicle could be costing over £3,450 a year, when taking fuel, insurance, tax and maintenance into account. By considering carpool schemes, Brits could save in the region of £3,000 per annum.
Potential annual saving: £3,453
By making sacrifices and giving up certain luxuries, Brits could generate a huge saving of £12,445.40 each year, which they could put towards a deposit.
We don't realise how much the little things add up, but it is clear to see that the things we take for granted in our day-to-day lives are really putting the brakes on our ability to save for our dream homes.
If people are able to make small changes to their everyday routines, they will soon see the savings build up, and in no time at all there will be a comfortable amount ready to be invested in bricks and mortar.
For more information and calculations, please visit: https://www.urban.co.uk/blog/post/Six-tips-to-help-save-for-a-house-deposit.aspx