The dream of owning a first home means many potential buyers have to be dedicated and often inventive to build their savings.

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The UK housing market remains a challenging environment for aspiring first-time buyers, and saving for a deposit continues to be one of the biggest obstacles.

Those trying to get on to the property ladder may now require a deposit of more than £50,000, according to recent figures from the Office for National Statistics* – and that’s without factoring in the additional costs of buying, such as stamp duty, legal fees and moving costs. 

Given that many cash-strapped millennials have only a few thousand pounds in accessible savings (and often significantly less), the outlook may seem pretty bleak. 

Unless you think outside the box. 

Some savers are taking innovative measures to raise enough for a deposit. And with living costs being consistently one of the biggest overheads, 86%** of people have considered alternative housing options as opposed to renting privately.

This is according to a new study which reveals just how far some people are prepared to go to save money.

Half of those polled say they would consider living on a boat to cut back on their spending, with some saying they would consider living in a car, a shed – or Harry Potter-style ‘under the stairs’ while saving. A few said they would even contemplate living at work.

While some of these options may sound a little far-fetched, this research does show just how hard it can be for those trying to amass the funds to get a place of their own. 

More conventional choices for those struggling to save for a deposit include living in a house-share or returning to the family home to reduce costs. But even these options require some pretty big sacrifices.

Here we speak to three young people about the lengths they have gone to try and build sufficient funds to get a foot on the property ladder.

George and Lisa: living on a canal boat

George M, 30, and his girlfriend, Lisa, 26, have been living on a canal boat since October to reduce their outgoings so they can save a deposit for a place of their own.

The couple had been renting in Hertfordshire until September 2017 when the landlord announced he was selling the property. They decided to consider alternative housing options that would allow them to save.

“We looked at specialist boat sale site, Apolloduck – as well as Ebay and Gumtree – and eventually found a 50ft cruiser stern for sale for £40,000,” says George.

“We bought the boat with a combination of a personal loan and some savings. Aside from the loan repayments (of around £500 a month), we now only have to pay for fuel and coal. We can live on one salary and save around £2,500 per month towards our deposit.”

George and Lisa have a continuous cruising licence which means they have to move every two weeks, but love the experience of exploring Hertfordshire by its waterways.

The couple plan to live on the boat for four years before using their savings and the proceeds from the sale of the boat as a deposit for a place of their own.

Lisa P: living in a house share in London

Lisa P, 27, took some drastic measures to make savings while building a deposit for her first home, including living in a house share in London with four other people for nearly six years. 

“It was hard work at times living with so many other people,” says Lisa, who works as a consultant. “But I was able to save a lot, so it was worth it.”

Lisa has been strict about budgeting while trying to save. “I always spend on a credit card that gives me points and vouchers – or via a cashback site, such as Topcashback, so I earn money as I spend,” she says.

“I rarely buy anything at full price, and always look for offers on food, clothes and electronic stuff. It requires a bit of time and effort scouring the internet, and sometimes means waiting patiently for the sales.”

Lisa put the savings into a Help to Buy ISA and after six years was able to buy her first home in December 2017.

“I’m now the proud owner of a four-bed house in Manchester,” she says. “All that hard work really has paid off.”

Imogen and Nicc: living with parents

Imogen Shaw, 22, lived at home with her dad until she was 21 so she could save towards a deposit, and her boyfriend, Nicc, also lived with his parents.

“I’m from Nottingham, but got a job in Leeds in 2013 when I was 17,” says Imogen who works in production. “In 2016, Nicc and I decided to get a place of our own, but felt it would make more sense to go on living at home while we saved."

The couple set themselves a goal of saving £10,000 each for a deposit. “I lived with dad and paid £290 a month towards rent and other costs, while Nicc lived with his mum and paid around £200 a month,” says Imogen.

“Living at home made it a lot easier to save, but I also made sacrifices. I rarely bought new clothes and almost never went out. That meant I could save £1,000 a month into our deposit fund.”

Both Imogen and Nicc saved into Help to Buy ISAs and in November 2017 bought a three-bed house in Baildon, Leeds.

“We wouldn’t have been able to do it without extremely supportive families,” says Imogen. “We appreciate everything our parents have done for us – and now love having a place of our own.”

Getting help from family members can offer a lifeline

Having help from family members can make a big difference to being able to take the first step on to the property ladder.

If you are one of the many aspiring homeowners struggling to raise enough for a deposit you could consider the Post Office Family Link mortgage, provided by Bank of Ireland UK. 

This enables you to get help from a parent – or other close relative – without them needing to dip into their own savings or gift a cash deposit. 

With this product, you take out a 90% LTV mortgage through the Post Office and then raise the other 10% as a mortgage, also through the Post Office, secured against the home of your parent, as long as it’s mortgage free. 

You make two separate repayments for the first five years – one towards the assistor’s mortgage (which is interest free) and one towards your own mortgage (which incurs interest).

After five years of payments, you will have paid off the 10% assistor mortgage and reduced the balance on your own 90% mortgage.

Plus as long as house prices don’t fall, you will have reduced the size of your mortgage compared to the value of your home.

  • The mortgage has a 90% LTV.

  • Five-year fixed rate.

  • The maximum loan size is £500,000.

  • The only upfront costs in relation to your mortgage will be your solicitor and legal fees.

  • The assistor’s property must have a minimum value of £150,000

  • The assistor must take independent legal advice before completion.

Sources: * /**


*This post is in collaboration with Post Office. Subject to status and lending criteria. Your Home may be repossessed if you do not keep up repayments on your mortgage. Post Office Family Link mortgage information accurate at date of publication, June 2019*

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