First-time buyers face challenges despite government housing loan scheme

Aspiring homeowners in the UK are struggling to save for deposits amid rising living costs and house prices, BBC reported. The government is expected to provide further details on its proposed Your First Home scheme in the upcoming Budget, which aims to help first-time buyers purchase homes with deposits as low as 2.5%.

Luke Anstee, a 23-year-old IT worker, has been saving for three years but finds home ownership still out of reach due to increased expenses. Having moved frequently during his childhood, he hopes to gain stability by owning a home but notes that rising weekly shopping costs and student loan repayments affect his savings.

Similarly, Pre Ramteke, who moved to the UK in 2021, pays about £900 monthly in rent and finds saving for a deposit challenging despite the prospect that mortgage instalments would be comparable to rent. She estimates it could take three to four years to save enough for a typical three-bedroom home deposit.

Estate agent Zunara Tariq highlighted affordability as a major issue, noting that even high earners find it difficult to save for deposits due to the combined impact of cost-of-living increases and housing prices.

The government’s Your First Home scheme aims to address these challenges by lowering deposit requirements, but many first-time buyers remain cautious as they await further Budget details.