{"id":117260,"date":"2026-02-05T12:30:00","date_gmt":"2026-02-05T12:30:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=117260"},"modified":"2026-02-05T11:49:12","modified_gmt":"2026-02-05T11:49:12","slug":"why-first-time-buyers-are-turning-to-isas","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/why-first-time-buyers-are-turning-to-isas\/","title":{"rendered":"Why First-Time Buyers Are Turning to ISAs to Conquer the \u00a323,000 Deposit"},"content":{"rendered":"\n

The dream of homeownership in the UK remains out of reach for many first-time buyers, with new research revealing that the average deposit now stands at \u00a323,000<\/strong>. Despite this daunting figure, experts argue that steady savings habits and the strategic use of government-backed tools, such as the Lifetime ISA (LISA), offer a pathway to homeownership, especially for those willing to stick to a consistent plan.<\/p>\n\n\n\n

As the cost of living continues to climb and wages struggle to keep up, the challenges of entering the property market <\/strong>seem more formidable than ever. First-time buyers across the UK must navigate a complex landscape of rising house prices, stricter lending criteria, and the uncertainty surrounding interest rates. However, with the right financial strategies, including a focus on disciplined saving and targeted government incentives, purchasing a first home is still within reach for many.<\/p>\n\n\n\n

Regional Variations in Deposit Requirements<\/h2>\n\n\n\n

According to new data from Nationwide<\/a>, the amount required for a first-time buyer\u2019s deposit varies significantly across the country. The average deposit for a starter home is \u00a323,000, but that figure is far from universal. In high-demand areas like Inner London, the deposit requirement can reach a staggering \u00a344,800<\/strong>, requiring almost nine years of saving at current rates. In contrast, those looking to buy in more affordable regions, such as the North East, face a much lower deposit requirement of \u00a313,100<\/strong>, which can be saved in around four years.<\/p>\n\n\n\n

Other regions show considerable differences as well, with deposits in Outer London and the South East averaging \u00a332,800<\/strong> and \u00a326,300,<\/strong> respectively. Meanwhile, the South West requires a deposit of \u00a324,700<\/strong>. These regional disparities highlight the varying challenges first-time buyers face depending on where they are looking to buy, with those in the South of England especially struggling to save enough for a deposit.<\/p>\n\n\n\n

First-time buyers in areas with higher deposit requirements often feel that the goal of homeownership is increasingly elusive, especially as house prices remain high despite recent economic slowdowns. According to Nathan Emerson<\/a>, CEO of Propertymark, the ongoing difficulty of saving for a deposit shows just how significant the barrier remains, particularly in London and the South East.<\/p>\n\n\n\n

Lifetime ISA Remains a Strong Option for First-Time Buyers<\/h2>\n\n\n\n

One tool that continues to help first-time buyers is the Lifetime ISA (LISA), which offers a 25% government bonus on savings up to \u00a34,000<\/strong> annually. This bonus can significantly shorten the time it takes to save for a deposit, with potential savings of up to \u00a31,000 per year. <\/p>\n\n\n\n

According to Sophie Graham, a personal finance expert at Sunny, the LISA <\/strong>remains one of the most effective tools available, despite recent proposals for reform. Graham noted that the LISA is ideal for those confident they will buy a qualifying property within the scheme\u2019s rules, although it is crucial to assess whether the account suits one’s specific circumstances.<\/p>\n\n\n\n

Graham also emphasised that while the LISA is a helpful option, it is not a one-size-fits-all solution. First-time buyers should be mindful of the scheme\u2019s limitations, particularly if there is uncertainty around the location <\/strong>or timing <\/strong>of a potential purchase. In such cases, combining a LISA with more flexible savings accounts or regular saver products may be a better approach.<\/p>\n\n\n\n

The importance of consistency in saving cannot be overstated. Graham stressed that small, everyday habits often present a bigger challenge than finding the perfect savings account. For many, success lies in setting up automated savings, regularly reviewing spending habits, and gradually increasing contributions as income grows.<\/p>\n","protected":false},"excerpt":{"rendered":"

First-time buyers face the daunting challenge of saving \u00a323,000 for a home deposit. With the right savings strategy, however, the goal may be more achievable than it seems.<\/p>\n","protected":false},"author":10,"featured_media":117262,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-117260","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-housing","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/117260","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/comments?post=117260"}],"version-history":[{"count":2,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/117260\/revisions"}],"predecessor-version":[{"id":117263,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/117260\/revisions\/117263"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media\/117262"}],"wp:attachment":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media?parent=117260"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/categories?post=117260"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/tags?post=117260"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}