First-timers blow deposits

Mar 19 2008 by Eryl Jones, Western Mail

Four out of 10 people trying to get on to the property ladder admit they have blown some of the money they saved towards a deposit, research showed yesterday.

Around 42% of would-be first-time buyers have raided their deposit savings, withdrawing an average of £5,430 each, according to high street bank Abbey. The proportion is nearly four times higher than the 11% of people who said they had spent their savings towards a house last year.

Just over half of those who spent money they were saving towards a property deposit said they needed the cash to meet day-to-day living costs, but 52% admitted they had blown the money on clothes or gadgets and 50% spent it on a holiday.

One in four people used their savings to buy a car, with men most likely to do this, and 4% said they had decided to use the money to fund a wedding or other celebration.

The average first-time buyer thinks they will need nearly £23,000 to buy their first home, and they claim they will be able to save this money in three-and-a-half years.