Launching its report ‘Stepping Up To The Mark: Building Societies Responding To The Housing Affordability Crisis’, the BSA found that finding a deposit was the biggest worry for potential FTBs, followed by being able to afford the monthly repayments, Stamp Duty and then other costs.
The BSA claimed that societies were doing plenty to try to assist FTBs in getting onto the property ladder, but it believed there was much that needed to be done – especially at a government level – to help alleviate affordability issues.
Adrian Coles, director-general of the BSA, said: “It is no surprise that with the average house price being almost £220,000, raising a deposit is such a barrier for FTBs. The existing government schemes designed to help aspirant FTBs fail to recognise that this is where the problem lies, rather than the monthly mortgage repayment.”
The report called for the government to place greater emphasis on helping FTBs raise capital for a deposit, while it deemed greater co-operation between government and lenders as essential to ensure schemes were workable in the market.
It also demanded reform to section 106 of the planning system, which regulates the level of affordable housing in a development, as well as addressing the problems of inadequate supply and the high additional costs to purchase a property.
Michael Brill, director at Baronworth Investment Services, commented: “It’s not the monthly payments, which are still quite high, but the raising of the deposit. If property prices do come down, it won’t do FTBs any harm, but it won’t be any help at all if they can’t find a decent deposit.”
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