Millions of aspiring homeowners may be delaying their plans unnecessarily, with many significantly overestimate how much deposit they need to get on the property ladder, Mortgage Advice Bureau reveals.
MAB data found that misconceptions around upfront costs may be holding back just as many buyers as financial barriers themselves.
Research shows that 73% are unaware of 95% loan-to-value (LTV) mortgages, while 80% are unaware of ‘track record’ mortgages and 70% are unaware of the full range of family-assisted mortgage options.
MAB says this suggests many prospective buyers may be ruling themselves out of a property purchase before fully understanding what’s available.
While saving for a deposit is widely seen as a key hurdle, perceptions don’t always match reality as 27% say their deposit is the biggest dealbreaker and 39% believe a deposit of 10% or more is required.
Only 50% correctly identify 5% as the typical minimum deposit amount, which highlights how misunderstanding deposit requirements may be delaying decisions unnecessarily.
The research also shows many buyers are unaware they can get onto the property ladder with family support. Of respondents, 52% say they would consider a parent or family member boosting their borrowing power, but 29% didn’t realise this was even an option.
MAB says this suggests some aspiring homeowners may be overlooking viable routes to buying, based on the assumption that financial help must come in the form of cash savings.
MAB strategic lender relationship director Rachel Geddes says: “For many aspiring homeowners, the biggest barrier isn’t always the reality of the deposit required – it’s what they believe that number needs to be.”
“What this research shows is that a large proportion of buyers are making decisions based on assumptions, particularly around how much they need to save before they can even consider buying.”
